Answered step by step
Verified Expert Solution
Question
1 Approved Answer
Question 2 of4 - /1 E View Policies Current Attempt in Progress Whispering Winds Company is considering the purchase of a new machine. The invoice
Question 2 of4 - /1 E View Policies Current Attempt in Progress Whispering Winds Company is considering the purchase of a new machine. The invoice price of the machine is $72,900, freight charges are estimated to be $2,970. and installation costs are expected to be $7.560. The annual cost savings are expected to be $27,000 for 10 years. Calculate the cash payback period. (Round answer to 2 decimal places, 53' 15.25.) Cash payback period years Question 3 of 4 - 148 View Policies Current Attempt in Progress Vaughn Corp. is considering purchasing one of two new diagnostic machines. Either machine would make it possible for the company to bid on jobs that it currently is not equipped to do. Estimates for each machine are as follows: Machine A Machine B Original cost $78,400 $190,300 Estimated life 8 years 8 years Salvage value 0 0 Estimated annual cash inflows $22,000 $40,100 Estimated annual cash outflows $5,100 $8,800 Click here to view the factor 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 e.g. -45 or parentheses e.g. (45). For calculation purposes, use 5 decimal places as displayed in the factor table provided, e.g. 1.25124 and final answers to O decimal places, e.g. 5,275. Round profitability index answers to 3 decimal places, e.g. 12.521.) Machine A Machine B Net present value A $ Profitability index Which machine should be purchased?on: Question 4 of 4
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started