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take machine cost to be Rs 150,000. Waseem Textile Mills is considering the purchase of a new machine to enhance productivity and ensure timely completion
take machine cost to be Rs 150,000.
Waseem Textile Mills is considering the purchase of a new machine to enhance productivity and ensure timely completion of export orders. The machine will cost Rs (machine cost = enter your registration number), plus Rs. 500,000 for shipping and installation cost. Financial Analyst forecasts that this machine will generate revenue by Rs. 1,000,000 for each of the next 5 years. The interest rate is 12% at which the firm can finance the machine through bank financing. Compute the following and also decide whether this project should be accepted based on computations for each of the following: a. Find the payback period. Firm has a cut-off period of 3 years to recover all investment cost from the project. b. Find discounted payback period. Firm has a cut-off period of 3 years to recover all investment cost from the project. c. Find net present value. d. Find profitability indexStep by Step Solution
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