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Seate Hospital, a tapaying entity, estimates that it can save $23.000 a year in cash operating costs for the next years if it buys a

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Seate Hospital, a tapaying entity, estimates that it can save $23.000 a year in cash operating costs for the next years if it buys a special purpose eye-testing machine at a cost of $90,000. No terminal disposal value is expected. Seattle Hospital's required rate of retum is 14%. Assume al cash flows cocurat year end except for initial investment amounts Seattle Hospital uses straight line depreciation. The income tax rate is 20% for all transactions that the Click the icon to view the Future Value of $1 factors) (Click the icon to view the Future Value of Annuity of $1 factors.) (Click the icon to view the Present Value of $1 factors.) (Click the icon to view the Present Value of Annuky $1 factors) Read the requirements Requirement 1. Calculate the following for the special purpose eye testing machine Net procent value (NPR) (Round interim calculations and your final awwers to the nearest whole dolar. The net present value is $ 1. Calculate the following for the special purpose eye-testing machine Not presenta b. Payback period Internal rate of return d. Accrual accounting rate of refum based on net initial investment Accrual accounting rate of retum based on average investment 2. How would your computations in requirement 1 be affected if the special purpose machine had a $13.000 terminal disposal value at the end of years? Asume depreciation deductions are based on the 500,000 purchase cost and zero terminal diaporal value using the right in method. Answer briefly in words without further calculations a. Print Done Seattle Hospital, a taxpaying entity, estimates that it can save $23,000 a year in cash operating costs for the next 8 years if it buys a special-purpose eye-testing machine at a cost of $90,000. No termir il disposal value is expected. Seattle Hospital's required rate of return is 14%. Assume all cash flows occur at year-end except for initial investment mounts. Seattle Hospital uses straight-line depreciation. The income tax rate is 28% for all transactions that affect income taxes. (Click the icon to view the Future Value of $1 factors.) Click the icon to view the Future Value of Annuity of $1 factors.) (Click the icon to view the Present Value of $1 factors.) (click the icon to view the Present Value of Annuity of $1 factors.) Read the requirements Requirement 1. Calculate the following for the special-purpose eye-testing machine: Net present value (NPR) (Round interim calculations and your final answers to the nearest whole dollar. Use a minus sign or parentheses for a negative net present value.) The net present value is $ eye-testing machine: mal answers to the nearest whole dollar. Use a minus sign or paren eses for a negative stat present value.) i Requirements a. 1. Calculate the following for the special-purpose eye-testing machine: Net present value b. Payback period c. Internal rate of return d. Accrual accounting rate of return based on net initial investment Accrual accounting rate of return based on average investment 2. How would your computations in requirement 1 be affected if the special-purpose machine had a $13,000 terminal disposal value at the end of 8 years? Assume depreciation deductions are based on the $90,000 purchase cost and zero terminal disposal value using the straight-line method. Answer briefly in words without further calculations. e. Print Done e next

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