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please show work thank you! 6. Deedlebop Dessert Company is looking into the below additional products for its menu to expand sales. The company will
please show work thank you!
6. Deedlebop Dessert Company is looking into the below additional products for its menu to expand sales. The company will have training costs when the machine(s) are installed. The company expects all machines to have a useful life of 5 years at which time it will dispose of the machine and purchase a new one if the product is successful. The machines, costs, and expected contribution margin are detailed below: Ice Cream Machine: Cost of machine $ 5,100 Cost to train employees $ 700 Annual increase in contribution margin $ 1,600 Disposal value $ 600 I Popcom Machine: Cost of machine $ 850 Cost to train employees $ 200 Annual increase in contribution margin $ 350 Disposal value S 50 Espresso Machine: Cost of machine $ 2.900 Cost to train employees $ 900 Annual increase in contribution margin $ 1.000 Disposal value $ 1.500 Deedlebop Desert Company Discount Rate: 11% A. What is the net present value of the ice crqam machine (round to 2 decimal places, ex. 9.99)? B. What is the net present value of the popcorn machine (round to 2 decimal places, ex. 9.99)? c. What is the net present value of the espresso machine (round to 2 decimal places, ex 9.99) Step by Step Solution
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