that it is January 1, 2019, and that the Mendoza Company is considering the replacement of a machine that has been used for the past 3 years in a special project for the company. This project is expected to continue for an additional 5 years ie until the end of 2023). Mendoza will either keep the existing machine for another 5 years (8 years total) or replace the existing machine now with a new model that has a 5-year estimated life. Pertinent facts regarding this decision are as follows: Purchase New Machine $190,000 5 years $ 25, 800 Keep Existing Purchase price of machine (including transportation, Machine setup charges, etc.) Useful life (determined at time of acquisition) 6158,000 Estimated salvage value, end of 2023 8 years Expected cash operating costs, per year: $ 20,800 Variable (per unit produced/sold) 6 33 Eixed costs (total) $125,00 Estimated salvage (terminal) values: January 1, 2019 $ 68, 800 December 31, 2023 $ 13, 200 Het working capital committed at time of acquisition of existing machine (all Eully recovered at end of project, December 31, 2023) $ 30,800 Incremental net working capital required if new machine 13 purchased on January 1, 2019 (all fully recovered at end of project, December 31, 2023) Expected annual volume of output/sales (in unita), over 508,000 the period 2019-2023 $ 0.27 $ 24,800 $ 23,600 $ 10,800 508,000 *Note: These amounts are used for depreciation calculations. Assume further that Mendoza is subject to a 40% income tax, both for ordinary income and gains/losses associated with disposal of machinery, and that all cash flows occur at the end of the year, except for the initial investment Assume that straight-line depreciation is used for tax purposes and that any tax associated with the disposal of machinery occurs at the same time of the related transaction Required: 1. Determine relevant cash flows (after-tax) at time of purchase of the new machine (ie, time 0 January 1, 2019) 2 Determine the relevant (after-tax) cash inflow each year of project operation (ie, at the end of each of years 1 through 5). 3. Determine the relevant (after-tax) cash inflow at the end of the project's life (ies at the project's disposal time. December 31, 2023) 5. Determine the undiscounted net cash flow (after tax) for the new machine and determine whether on this basis the old machine should be replaced. (For all requirements, do not round intermediate calculations. round your answers to the nearest whole dollar amount.) 124 900 1 Net cash flow (after-tax), time 0 fie at purchase point) 2 Net cash inflow after-tax), during the project operation Net cash inflow (after-tax), at the end of the project's life 5 Undiscounted net cash flow after tax) for the new machine Williams Inc. produces a single product, a part used in the manufacture of automobile transmissions. Known for its quality and performance, the part is sold to luxury auto manufacturers around the world. Because this is a quality product, Williams has some flexibility in pricing the part. The firm calculates the price using a variety of pricing methods and then chooses the final price based on that information and other strategic information. A summary of the key cost information follows. Williams expects to manufacture and sell 54,000 parts in the coming year. While the demand for Williams's part has been growing in the past 2 years, management is not only aware of the cyclical nature of the automobile industry, but also concerned about market share and profits during the industry's current downturn Variable manufacturing Variable selling and administrative Facility-level fixed overhead Fixed selling and administrative Batch-level fixed overhead Total investment in product line Expected sales (units) Total Costs $ 4,672, 000 847, 650 2,337,875 667,495 352,000 22,342,000 54,000 Required: 1. Determine the price for the part using a markup of 45% of full manufacturing cost. 2 Determine the price for the part using a markup of 23% of full life-cycle cost. 3. Determine the price for the part using a desired gross margin percentage to sales of 43%. 4. Determine the price for the part using a desired life-cycle cost margin percentage to sales of 20%. 5. Determine the price for the part using a desired before-tax return on investment of 12%. 6. Determine the total contribution margin and total operating profit for each of the methods in requirements through 5. Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required 3 Required 4 Required 5 Requred 6 Determine the total contribution margin and total operating profit for each of the methods in requirements 1 through 5. (Round your intermediate calculations to 4 decimal places and final answers to the nearest whole dollar amount.) Method Markup on full manufacturing cost Markup on life cycle costs Price to achieve desired CM% Price to achieve desired LCC % Contribution Margin $ 5,155,056 $ 5,399,055 5 7,395,905 5,576,596 $ 6,038,377 Operating Profit 1,797,686 2,041,685 4,038,535 2.219 226 Price to achieve desired ROA of 12% Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required 3 Required 4 Required 5 Required 6 Determine the price for the part using a markup of 45% of full manufacturing cost. (Do not round intermediate calculations. Round your answer to 4 decimal places.) S 1976800 per unit Required Required 2 > Required 1 Requirland 2 Required 3 Required 4 Required 5 Required 6 Determine the price for the part using a markup of 23% of full life-cycle cost. (Do not round intermediate calculations. Round your answer to 4 decimal places.) Price $ 202.1985 per unit Required 1 Required 2 Required 3 Required 4 Required 5 Required 6 Determine the price for the part using a desired gross margin percentage to sales of 43%. (Round your intermediate calculations and answer to 4 decimal places.) Price $ 239.1772 per unit Required 1 Required 2 Required 3 Required 4 Required 5 Required 6 Determine the price for the part using a desired life-cycle cost margin percentage to sales of 20%. (Round your intermediate calculations and answer to 4 decimal places.) Price $ 205.4863 per unit Required 1 Required 2 Required 3 Required 4 Required Reguired 6 Determine the price for the part using a desired before-tax return on investment of 12%. (Round your intermediate calculations and answer to 4 decimal places.) Price 214.0378 per unit