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would appreciate very very much if could solve this 3 problems separately, hopefully the 3 of them, not only 1 thanks 1) 2) 3) Sunland
would appreciate very very much if could solve this 3 problems separately, hopefully the 3 of them, not only 1 thanks
Sunland Corporation is involved in the business of injection molding of plastics. It is considering the purchase of a new computer-aided design and manufacturing machine for $440,600. The company believes that with this new machine it will improve productivity and increase quality, resulting in an increase in net annual cash flows of $107.165 for the next 6 years. Management requires a 10% rate of return on all new investments. Click here to view the factor table. Calculate the internal rate of return on this new machine. (Round answer to 0 decimal places, es. 13\%. For calculation purposes, use 5 decimal ploces as displayed in the factor table provided.) Internal rate of return 96 Sheridan Inc. wants to purchase a new machine for $28,110, excluding $1,400 of installation costs. The old machine was purchased 5 years ago and had an expected economic life of 10 years with no salvage value. The old machine has a book value of $2,000, and Sheridan Inc, expects to sell it for that amount. The new machine will decrease operating costs by $6,500 each year of its economic life. The straight-line depreciation method will be used for the new machine for a 6-year period with no salvage value. Click here to view the factor table. (a) Determine the cash payback period. (Round cash payback period to 2 decimal places, eg. 10.53.) Cash payback period years (b) Determine the approximate internal rate of return. (Round answer to 0 decimal ploces, es. 13%. For calculation purposes, use 5 decimal ploces as displayed in the factor toble provided) Internal rate of return (c) Assuming the company has a required rate of return of 9%, determine whether the new machine should be purchased. The investment be accepted. Ivanhoe Oil Company is considering investing in a new oil well. It is expected that the oil well will increase annual revenues by $128,225 and will increase annual expenses by $85,000 including depreciation. The oil well will cost $446,000 and will have a $9,000 salvage value at the end of its 10 -year useful life. Calculate the annual rate of return. (Round answer to 0 decimal ploces, eg. 13\%.) Annual rate of return 1)
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