Stupendous Candy Company is considering purchasing a second chocolate dipping machine in order to expand their business. The information Stupendous has accumulated regarding the new machine is: (Click the icon to view the information.) Present Value of $1 tablo Present Value of Annuity of $1 table Future Value of $1 table Future Value of Annuity of $1 table Read the requirements Requirement 1. Calculate the following for the new machine a. Net present value (NPV) (Use factors to three decimal places, X.XXX, and use a minus sign or parentheses for a negative net present value. Enter the nel present value of the investment rounded to the nearest whole dolar.) The net present value is $ $100,000 $19,000 Cost of the machine Increased contribution margin Life of the machine Required rate of return 8 years 6 % Stupendous estimates they will be able to produce more candy using the second machine and thus increase their annual contribution margin. They also estimate there will be a small disposal value of the machine but the cost of removal will offset that value. Ignore income tax issues in your answers. Assume all cash flows occur at year-end except for initial investment amounts. Calculate the following for the new machine: a. Net present value b. Payback period Discounted payback period d. Internal rate of return (using the interpolation method) e. Accrual accounting rate of return based on net initial investment (assume straight-line depreciation) What other factors should Stupendous Candy consider in deciding whether to purchase the new machine? 2. ( ( ( Present Value of $1 Periods 29% 0.980 0.961 0.942 0.924 0.906 6 0.888 0.871 0.853 0.837 10 0.820 0.804 0.788 0.773 0.758 0.743 16 0.728 17 0.714 18 0.700 C ( ( 4% 0.962 0.925 0.889 0.855 0.822 0.790 0.760 0.731 0.703 0.676 0.650 0.625 0.601 0.577 0.555 0.534 0.513 0.494 6% 8% 0.9430.926 0.890 0.857 0.840 0.794 0.792 0.735 0.747 0.681 0.705 0.630 0.665 0.583 0.627 0.540 0.592 0.500 0.558 0.463 0.527 0 .429 0.497 0.397 0.469 0.368 0.442 0.340 0.417 0.315 0.394 0.292 0.371 0270 0.350 0.250 10% 0.909 0.826 0.751 0.683 0.621 0.564 0.513 0.467 0.424 0.386 0.350 0.319 0.200 0.263 0.239 0.218 0.198 0.180 12% 0.893 0.797 0.712 0.636 0.567 0.507 0.452 0.404 0.361 0.322 0 287 0.257 0.229 0.205 0.183 0.163 0.146 0.130 14% 0.877 0.769 0.675 0.592 0.519 0.456 0.400 0.351 0.308 0.270 0237 0.208 0.182 0.160 0.140 0.123 0.108 0.095 16% 0.862 0.743 0.641 0.552 0.476 0.410 0.354 0.305 0.263 0.227 0.195 0.168 0.145 0.125 0.108 0.093 0.080 0.069 18% 0.847 0.718 0.609 0.516 0.437 0.370 0.314 0.266 0.225 0.191 0.162 0.137 0.116 0.099 0.084 0.071 0.060 0.051 20% 0.833 0.694 0.579 0.482 0.402 0.335 0.279 0.233 0.194 0.162 0.135 0.112 0.093 0.078 0.065 0.054 0.045 0.038 22% 0820 0.672 0.551 0.451 0.370 0.303 0.249 0.204 0.167 0.137 0.112 0.092 0.075 0.062 0.051 0.042 0.034 0.028 24% 26% 0.806 0.794 0.650 0.630 0.524 0.500 0.4230 397 0.341 0.315 0.275 0.250 0.222 0.198 0.179 0.157 0.144 0.125 0.116 0.099 0.094 0.079 0.076 0.062 0.061 0050 0.049 0.039 0.040 0.031 0.032 0.025 0.026 0.020 0.021 0.016 28% 0.781 0.610 0.477 0.373 0.291 0.227 0.178 0.139 0.108 0.086 0.000 0.052 0.040 0.032 0.025 0.019 0,015 0.012 30% 0.769 0.592 0.455 0.350 0269 0.207 0.159 0.123 0.094 0.073 0.056 0.043 0.033 0.025 0.020 0.015 0,012 0.009 ( ( ( 15 ( ( ( Present Value of Annuity of $1.00 in Arrears Periods 2% 4% 6% 8% 10% 12% 14% 1 0.980 0.962 0.9430.926 0.909 0.893 0.877 2 1.942 1.886 1.8331.783 1.736 1.690 1.647 3 2.884 2.775 2.673 2.577 2487 2.402 2322 3.808 3.630 3.465 3.312 3.170 3.037 2.914 4.713 4.452 4.212 3.993 3.791 3.605 3.433 5.601 5.2424.917 4.623 4.355 4.111 3.889 6.472 6.002 5.582 5 206 4.868 4.564 4.28.8 7.325 6.733 6.210 5.747 5.335 4.968 4.639 8.162 7.435 6.802 6.247 5.759 5.328 4.946 8.983 8.111 7.360 6.710 6.145 5.6505.216 9.787 8.760 7.8877 1396.495 5.918 5.453 10.575 9.385 8.384 7.5366 .814 6.194 5.660 11.348 9.986 8.853 7.904 7.103 6.424 5.842 12.106 10.583 9.2958 .244 7367 6.628 6.002 12.849 11.118 9.712 8.559 7.606 6.811 6.142 16 13.578 11.652 10.106 8.8517.824 6.974 6.265 17 14.292 12.166 10.477 9.1228.022 7.120 6.373 18 14.992 12.659 10.828 9.372 8.2017.250 6.467 16% 18% 0.862 0.847 1.6051.566 2246 2.174 2.798 2.690 3.274 3.127 3.685 3.498 4.039 3.812 4.344 4.078 4.607 4.303 4.833 4.494 5.029 4.656 5.197 4.793 5.342 4.910 5.468 5008 5.575 5.092 5.668 5.162 5.749 5.222 5.818 5.273 20% 22% 0.833 0.820 1.528 1.492 2.106 2.042 2.589 2.494 2.991 2.864 3.326 3.167 3.605 3.416 3.837 3.619 4.031 3.786 4.1923.923 4.327 4.035 4.439 4.127 4.533 4203 4.611 4 265 4.675 4.315 4.730 4.357 4.775 4.391 4.812 4.419 24% 0.806 1.457 1.981 2.404 2.745 3.020 3.242 3.421 3.566 3.682 3.776 3.851 3.912 3.962 4.001 4.033 4.059 4.080 26% 28% 30% 0.7940.781 0.769 1424 1.392 1.361 1.923 1.868 1.816 2.320 2.241 2.166 2.635 2.532 2.436 2.885 2.759 2.643 3.083 2.937 2.802 3.241 3.076 2.925 3.366 3.184 3.019 3.465 3.269 3.092 3543 3.335 3.147 3.606 3.387 3.190 3.656 3.427 3.223 3.695 3.459 3249 3.726 3.483 3.268 3.751 3.503 3.283 3.771 3.518 3.295 3.786 3.5293.304 Compound Amount of $1.00 (The Future Value of $1.00) Periods 2% 4% 6% 8% 10% 12% 14% 16% 1.020 1.040 1.060 1.080 1.100 1.120 1.140 1.160 1.040 1.082 1.124 1.166 1.210 1.254 1.300 1.346 3 1.061 1.125 1.191 1.260 1.331 1.405 1.482 1.561 4 1.082 1.170 1.262 1.360 1.464 1.574 1.689 1.811 1.104 1.217 1.338 1.469 1.611 1.762 1.925 2.100 1.126 1.265 1.419 1.587 1.772 1.974 2.195 2.436 1.149 1.316 1.504 1.714 1.949 2.211 2.502 2.826 1.172 1.369 1.594 1.851 2.144 2.476 2.853 3.278 1.195 1.423 1.689 1.999 2.358 2.773 3.252 3.803 1.219 1.480 1.791 2.159 2.594 3.106 3.707 4.411 1.243 1.539 1.898 2.332 2.853 3.479 4.226 5.117 12 1.268 1.601 2.012 2.518 3.138 3.8964.818 5.936 131.294 1.665 2.133 2.720 3.452 4.363 5.492 6.886 14 1.319 1.732 2.261 2.937 3.797 4.887 6.261 7.988 15 1.346 1.801 2.397 3.172 4.177 5.474 7.138 9.266 16 1.373 1.873 2.540 3.426 4.595 6.130 8.137 10.748 17 1.400 1.948 2.693 3.700 5.054 6.866 9.27612.468 18 1.428 2.026 2.854 3.996 5.560 7.690 10.575 14.463 18% 1.180 1.392 1.643 1.939 2.288 2.700 3.185 3.759 4.435 5.234 6.176 7.288 8.599 10.147 11.974 14.129 16.672 19.673 20% 1.200 1.440 1.728 2.074 2.488 2.986 3.583 4.300 5.160 6.192 7.430 8.916 10.699 12.839 15.407 18.488 22.186 26.623 22% 1.220 1.488 1.816 2.215 2.703 3.297 4.023 4.908 5.987 7.305 8.912 10.872 13.264 16.182 19.742 24.086 29,384 35.849 24% 1.240 1.538 1.907 2.364 2.932 3.635 4.508 5.590 6.931 8.594 10.657 13.215 16.386 20.319 25.196 31.243 38.741 48.039 26% 1.260 1.588 2.000 2.520 3.176 4.002 5.042 6.353 8.005 10.086 12.708 16.012 20.175 25.421 32.030 40.358 50.851 64.072 28% 1.280 1.638 2.097 2.684 3.436 4.398 5.629 7.206 9.223 11.806 15.112 19.343 24.759 31.691 40.565 51.923 66.461 85.071 Compound Amount of Annuity of $1.00 in Arrears (Future Value of Annuity) Periods 2% 4% 6% 8% 10% 12% 14% 1.000 1.000 1.000 1.000 1.000 1.000 1.000 2 2 .020 2.040 2.060 2.080 2.100 2.120 2.140 3 3.060 3.122 3.184 3.246 3.310 3.374 3.440 4.122 4.246 4.375 4.506 4.641 4.779 4.921 5.204 5.416 5.637 5.867 6.105 6.353 6.610 6.308 6.633 6.975 7.336 7.716 8.115 8.536 7 7.434 7.898 8.394 8.923 9.487 10.089 10.730 8 8.583 9.214 9.897 10.637 11.436 12.300 13.233 9.755 10.583 11.491 12.488 13.579 14.776 16.085 10.950 12.006 13.181 14.487 15.937 17.549 19.337 12.169 13.486 14.972 16.645 18.531 20.655 23.045 12 13.412 15.026 16.870 18.977 21.384 24.133 27.271 13 14.680 16.627 18.882 21.495 24.523 28.029 32.089 14 15.974 18.292 21.015 24.215 27.975 32.393 37.581 15 17.293 20.024 23.276 27.152 31.772 37.280 43.842 16 18.639 21.825 25.673 30.324 35.950 42.753 50.980 17 20.012 23.698 28.213 33.750 40.545 48.884 59.118 18 21.412 25.645 30.906 37.450 45.599 55.750 68.394 16% 1.000 2.160 3.506 5.066 6.877 8.977 11.414 14.240 17.519 21.321 25.733 30.850 36.786 43.672 51.660 60.925 71.673 84.141 18% 20% 1.000 1.000 2.180 2.200 3.572 3.640 5.215 5.368 7.154 7.442 9.442 9.930 12.142 12.916 15.327 16.499 19.086 20.799 23.521 25.959 28.755 32.150 34.931 39.581 42 21948.497 50.818 59.196 60.965 72.035 72.939 87.442 87.068 105.931 103.740 128.117 22% 24% 1.000 1.000 2.220 2.240 3.708 3.778 5.524 5.684 7.740 8.048 10.442 10.980 13.740 14.615 17.762 19.123 22.670 24.712 28.657 31.643 35.962 40.238 44.874 50.895 55.746 64.110 69.0108 0.496 85.192 100.815 104.935 126.011 129.020 157.253 158.405 195.994 26% 1.000 2.260 3.848 5.848 8.368 11.544 15.546 20.588 26.940 34.945 45.031 57.739 73.751 93.926 119.347 151.377 191.735 242.585 11