Saxon Products, Inc., is investigating the purchase of a robot for use on the company's assembly line. Selected data relating to the robot are provided below: Cont of the robot Installation and software Annual savinga in inventory carrying costs Annual increase in power and maintenance costa Salvage value in 5 years Useful life $1,600,000 $ 410,000 $ 223,000 $ 43,000 $ 72,000 years Engineering studies suggest that use of the robot will result in a savings of 24,000 direct labor hours each year. The labor rate is $15 per hout. Also, the smoother work flow made possible by the use of automation will allow the company to reduce the amount of Inventory on hand by $413,000. This inventory reduction will take place at the end of the first year of operation the released funds will be available for use elsewhere in the company, Saxon Products has a 18% required rate of return. Click here to view Exhibit 148-1 and Exhibit 1482. to determine the appropriate discount factor(s) using tables. Required: 1. Determine the annual net cost savings if the robot is purchased. (Do not include the $413,000 inventory reduction or the salvage value in this computation) 2-a. Compute the net present value of the proposed investment in the robot. 2-b. Based on these data, would you recommend that the robot be purchased? 3-a. Assume that the robot is purchased. However, due to unforeseen problems, software and installation costs were $88,000 more than estimated and direct labor could only be reduced by 19,000 hours per year , rather than the original estimate of 24,000 hours Assuming that all other cost dota is accurate, what would a postaudit suggest is the actual net present value of this investment? nane that the AMARALI Assuming that all other cost data is accurate, what would a postaudit suggest is the actual net present value of this investment? 3-b. Does it appear that the company made a wise investment? 4-a. Which of the following are intangible benefits associated with the new automated equipment? 4-6. Based on your analysis in Requirement 3 above, compute for the president the minimum dollar amount of annual cash inflow that would be needed from the benefits in part 4(a) for the automated equipment to yield a 18% rate of return. Answer is not complete. Complete this question by entering your answers in the tabs below. Req 1 Red 2A Reg 2B Req 3A Reg 38 Req 4A Req 48 Assume that the robot is purchased. However, due to unforeseen problems, software and installation costs were $88,000 more than estimated and direct labor could only be reduced by 19,000 hours per year, rather than the original estimate of 24,000 hours. Assuming that all other cost data is accurate, what would a postaudit suggest is the actual net present value of this investment? (Enter negative amount with a minus sign. Round your final answer to the nearest whole dollar amount.) Show less Nel present value $ (294,134) Assuming that all other cost data is accurate, what would a postaudit suggest is the actual net present value of this investment? 3-b. Does it appear that the company made a wise investment? 4-a. Which of the following are intangible benefits associated with the new automated equipment? 4-6. Based on your analysis in Requirement 3 above, compute for the president the minimum dollar amount of annual cash inflow that would be needed from the benefits in part 4(a) for the automated equipment to yield a 18% rate of return. Answer is not complete. Complete this question by entering your answers in the tabs below. Reg1 Reg 2A Reg 28 Reg 3A Req 38 Req 4A Rijg 48 Based on your analysis in Requirement 3 above, compute for the president the minimum dollar amount of annual cash inflow that would be needed from the benefits in part 4(a) for the automated equipment to yield a 18% rate of return. (Round your final answer to the nearest whole dolar amount.) Amount at annual cash now 94063
