Y Dessert Company is looking into the below additional products for its menu to expand sales. The company will have training costs when the machine(s) are installed. The company expects all machines to have a useful life of 5 years at which time it will dispose of the machine and purchase a new one if the product is successful. The machines, costs, and expected contribution margin are detailed below: Ice Cream Machine: Cost of machine $ 5,100 Cost to train employces $ 700 Annual increase in contribution margin $ 1,600 Disposal value $ 600 Popcorn Machine: Cost of machine $ 850 Cost to train employees $ 200 Annual increase in contribution margin $ 350 Disposal value $ 50 Espresso Machine: Cost of machine $ 2.900 Cost to train employees $ 900 Annual increase in contribution margin $ 1.000 Disposal value $ 1,500 Deedlebop Desert Company Discount Rate: 11%

QUESTIONS:

What is the profitability index of the ice cream machine?

What is the profitability index of the popcorn machine?

What is the profitability index of the espresso machine?

What is the payback period of the popcorn machine (round to 2 decimal places, ex. 9.99)?

What is the payback period of the espresso machine (round to 2 decimal places, ex. 9.99)?

What is the payback period of the ice cream machine (round to 2 decimal places, ex. 9.99)?