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The controller of Sheridan Industries has collected the following monthly expense data for use in analyzing the cost behavior of maintenance costs. Total Machine Hours
The controller of Sheridan Industries has collected the following monthly expense data for use in analyzing the cost behavior of maintenance costs. Total Machine Hours 350 Month January February March April May June Total Maintenance Costs $2.930 3,230 3,830 4.730 3.430 5,730 400 550 640 (21) Determine the variable cost components using the high-low method. (Round answer to 2 decimal places e.g. 2.25.) Variable cost per machine hour $ B. Determine the fixed components using the high-low method. (Round answer to 0 decimal places e.g. 2,520.) Total fixed costs - - - - - - - - - - - Bonita Company is considering a capital investment of $185.000 in additional productive facilities. The new machinery is expected to have a useful life of 5 years with no salvage value. Depreciation is by the straight-line method. During the life of the investment annual net income and net annual cash flows are expected to be $14,985 and $50,000, respectively. Bonita has a 12% cost of capital rate, which is the required rate of return on the investment. Click here to view PV table. Compute the cash payback period. (Round answer to 1 decimal place, e.g. 10.5.) Cash payback period years Compute the annual rate of return on the proposed capital expenditure. (Round answer to 2 decimal places, eg. 10.52%) Annual rate of return Using the discounted cash flow technique, compute the net present value. (If the net present value is negative, use either a negative sign preceding the number eg.-45 or parentheses eg. (45). Round answer for present value to O decimal places, eg. 125. For calculation purposes, use 5 decimal places as displayed in the factor table provided.) Net present value
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