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Stuck on this question B2B Co. is considering the purchase of equipment that would allow the company to add a new product to its line.
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B2B Co. is considering the purchase of equipment that would allow the company to add a new product to its line. The equipment is expected to cost $372,800 with a 4-year life and no salvage value. It will be depreciated on a straight-line basis. The company expects to sell 149,120 units of the equipments product each year. The expected annual income related to this equipment follows.
B2B Co. is considering the purchase of equipment that would allow the company to add a new product to its line. The equipment is expected to cost $372,800 with a 4-year life and no salvage value. It will be depreciated on a straight-line basis. The company expects to sell 149,120 units of the equipment's product each year. The expected annual income related to this equipment follows Sales Costs $. 233,000 Materials, labor, and overhead (except depreciation on new equipment) 82,000 93,200 23,300 198,500 34, 500 13,800 $ 20,700 Depreciation on new equipment Selling and administrative expenses Total costs and expenses Pretax income Income taxes (40%) Net income If at least an 9% return on this investment must be earned, compute the net present value of this investment. (PV of $1. FV of $1, PVA Of $1, and FVA of $1 (Use appropriate factor(s) from the tables provided.) Answer is not complete Chart Values are Based on: 368922 9% resent Value Select Chart Amount actor Present Value of an Annuity of 368,922x 3.2390 (x$ 1,194,938 $ 1,194,938 Net present valueStep by Step Solution
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