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You need to evaluate the purchase of a new molding machine. The equipment s basic price is $ 1 1 6 , 4 9 1
You need to evaluate the purchase of a new molding machine. The equipments basic price is $ and it would cost another $ to modify it for special use by your firm. The molding machine, which falls into the MACRS year class, would be sold after years for $ The MACRS rates for the first three years are and Use of the equipment would require an increase in net working capital spare parts inventory of $ The machine would have no effect on revenues, but it is expected to save the firm $ per year in beforetax operating costs, mainly labor. The firms marginal federalplusstate tax rate is and its cost of capital is How much is the year NOPAT for this project?
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