QUESTION 1

QUESTION 2

QUESTION 3

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Current Attempt in Progress Mega Company is considering the purchase of a new machine. The invoice price of the machine is $75,050, freight charges are estimated to be $4,940, and installation costs are expected to be $7,600. The annual cost savings are expected to be $19,000 for 10 years. Calculate the cash payback period. (Round answer to 2 decimal places, e.g. 15.25.) Cash payback period years TLC Corp. is considering purchasing one of two new diagnostic machines. Either machine would make it possible for the company to bidonjobs that it currently is not equipped to do. Estimates for each machine are as follows: Machine A Machine B $78,200 $190.400 8 years 8 years Original cost Estimated life Salvage value Estimated annual cash inflows Estimated annual cash outflows 0 0 $23,300 $40.500 $4,800 $8.900 Click here to view PV table. Calculate the net present value and profitability index of each machine. Assume a 10% discount rate. (If the net present value is negative, use either a negative sign preceding the number eg.-45 or parentheses eg. (45). For calculation purposes, use 5 decimal places as displayed in the factor table provided, eg. 1.25124 and final answers to decimal places, eg. 5,275. Round profitability index answers to 3 decimal places, eg. 12.521.) Machine A Machine B Net present value $ Profitability index Which machine should be purchased? Machines Machine A d Media Kendra Corporation is involved in the business of injection moulding of plastics. It is considering the purchase of a new computer-aided design and manufacturing machine for $425.100. The company believes that with this new machine it will improve productivity and increase quality, resulting in a $109.200 increase in net annual cash flows for the next five years. Management requires a 11% rate of return on all new investments. Click here to view PV table. Calculate the internal rate of return on this new machine. (Round answer to decimal places, eg. 10%. For calculation purposes, use 5 decimal places as displayed in the factor table provided, eg. 1.52124.) Internal rate of return % Should management accept the investment? The investment be accepted. should should not