Answered step by step
Verified Expert Solution
Link Copied!

Question

...
1 Approved Answer

This is for my accouting class thank you x Cheng.com 9 Fockor Company Is planning to add a new product to its Ine. To manufacture

image text in transcribedimage text in transcribed

This is for my accouting class thank you

image text in transcribedimage text in transcribedimage text in transcribedimage text in transcribedimage text in transcribedimage text in transcribed
x Cheng.com 9 Fockor Company Is planning to add a new product to its Ine. To manufacture they product, the company needs to buy a new machine at a $620.000 coat with an copecled four year life and a $34,0Q0 salvage value. Al sales are for each, and all costs are out of pocket Except for depreciation on the new machine. Additional Information includes the following. (PY e! $1 PVol SL PHA of $1, and FVA al $1) (we appropriate Inctoris) from the s-bles provided. Round PV factor value to a decimal places ) Expected annual sales of new product Expected annual costs of new product Direct materials 494, 604 Direct labor 685,000 Overhead (excluding straight-line depreciation on new machine) 476,060 Selling and administrative expenses 174. MM Income taxes JET Required: 1. Compute straight line depreciation for each your of this now machine's life. 3. Determine expected net income and net cash flow for each year of this machine's life 3. Compute this machine's parybick period assuming that cash flows occur everly throughout each year 4. Compute this machine's accounting rate of retum, assuming that income is cared evenly throughout each point 5. Compute the net present value for theymuching using a discount rate of $4 and atwarning that cash flows occur at each your-end. (Hint Salvage value Is a cash inflow at the end of the asset's life) Complete this question by entering your answers in the labs below. doqured 1 Required ] Crinite right .Ine depreciation for each year of this new machine's Ife 9 0 12 Next > G acer 5 P E 9% 5 E 8 9except for depreciation on the now machine. Additional Information includes the following (PV of $1 EV of $1. PVAcol $1 and Eva ed 9 $1 (Une appropriate factoris) from the tables provided. Hound PV factor value to 4 decimal places.] Expected annual sales of new product Expected armual costs of new product 52,190.909 Direct materials 404, 610 Direct labor Overhead (excluding straight- line depreciation on new machine) 686,000 476,809 Selling and administrative expenses Income taxes Required: 1. Compute straight line depreciation for each year of this new machine's life. 2. Determine expected net Income and net cash flow for each year of this machine's Ife. 3. Compute this machine's payback period. assuming that cash flows occur evenly throughout each year 4. Compute this machine's accounting rate of return. assuming that income is cared evenly throughout each year 5. Compute the met present value for this machine using a discount rate of $% and assuming that cash flows occur at each year end. (Hint Salvage value is a cash inflow at the end of the asset's life) Complete this question by entering your answers in the bates below. Required 2 Required ] Required a Compute stonight.line depreciation for each year of this new machine's E's. 9 of 12 here to search EH e G 4 5 E 6 P W E RRegard 3 9 Determine expected net Income and not cash flow for each year of this machine's life. Expected Net Income zipped Ixpected Net Cash Flow P Type here to search O 2 1080 acer 5 2' 5 A 5 E 6 9Exlen #3 (Ch 9:13) ) 5. Compute the net present value for this machine ining a discount rate of 45 and assuming that cash flows occur at each ye 9 Want Sahage value Is a cash Inbow at the end of the asset's Bec ] Complete this question by entering your answers in the tales below. Required 2 Required ] Required 1 Compute the not present value for this maching insing by Food 4% and assuming that cash flows ofrut at each year- end, (Hint: Salvage value Is a cash Inflow at the end of if kennedy fe ) (Do not round Intermediate calculations, Amounts to to deducted should be indicated by a minus sign.) Chart Valves we Based on: Cash Flow Select Chart Amount Present Value Annual cash flow Houdual wu Net prosent which Type here to search e G 080 acer 3 4 5 E 6 R

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access with AI-Powered Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Managerial Accounting

Authors: Ray H. Garrison, Eric W. Noreen, Peter C. Brewer

12th Edition

9780073526706

Students also viewed these Accounting questions

Question

WITH SOLUTIONS AND DIAGRAM . BOX THE FINAL ANSWERS STATISTICS

Answered: 1 week ago