Drill Press T Drill Press M Initial Investment S20,000 $30,000 Estimated Life 10 years 10 years Estimated Salvage Value $5,000 $7,000 Annual Operating Cost $12,000 $6,000 Annual Maintenance Cost $2,000 $4,0007
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Two numerically controlled drill presses are being considered by the production department of Zunni’s Manufacturing; one must be selected. Comparison data is shown in the table below. MARR is 10%/year. Solve, a. What is the future worth of each drill press? b. Which drill press should be recommended?
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- A Initial Cost + Installation $25,000 $15,000 Uniform end of year maintenance $2,000 $4,000 Overhaul, end of 3rd year $3,500 Salvage value $3,000 Service Lifetime 4 уrs 6 yrs Calculate the capitalized costyou are given the following information about a proposed project : Investment costs $15,000 Annual expenses $3,500 Annual Revenue $7500 Salvage Value $2000 Economic life 5 years M.A.R.R 10 % The net present worth of the project is closest to a.$1400 b.$1300 c.$1800 d.$1600Engineering Economics Determine the capitalized cost of a machine that was purchased for P100, 000 and requires annual maintenance of P18,000 if interest is 8% a. 305, 000 b. 315, 000 c. 325, 000 d. 335, 000 e. 345, 000
- Cost of the investment $ 52,000 Annual cost savings $ 16,000 Estimated salvage value $ 8,000 Life of the project 5 years Discount rate 13 % The net present value of the proposed investment is closest to: (Round your intermediate calculations and final answer to the nearest whole dollar amount.) Multiple Choice $8,616 $4,272 $4,344 $28,000you are given the following information about a machine : Investment costs $ 200,00O Salvage Value $ 20,000 Economic life 5 years M.A.R.R 10 % The capital Recovery Cost (C.R.Cost ) is closest : а. $ 55,800 b. $ 35,800 С. $ 49,480 d. $ 60,500Cost of new equipment: $200,000 Installation: $20,000 Change in Net Operating Working Capital: $50,000 New sales per year: $115,000 New operating costs per year: $50,000 Economic life: 4 years Depreciable life: MACRS 3-year class (33%, 45%, 15%, 7%) Salvage value: $20,000 Tax Rate: 25% WACC: 9% What is the total initial investment outlay (FCF0)? What is the operating cash flow for year 2, or FCF2? (SHOW ALL WORK/STEPS) What are the planned non-operating cash flows in year 4 (i.e. terminal cash flows)? (SHOW ALL WORK/STEPS) What is the book value of the equipment after three years?
- Create a units of production depreciation Cargo Van Price $26,000 Machine Price $48,000Salvage value $2,000 Salvage value $3,000Useful life 10 years Useful life 8 yearsTotal miles 90,000 Total hours 13,000Yr 1 miles 12,100 Yr 1 hours 1,250Yr 2 miles 9,400 Yr 2 hours 1,46You are given the following estimated information about a proposed project: Investment cost $ 66,000 Annual cost $/Year 10,000 Salvage value 10,000 Economic life 6 years M.A.R.R 10% Answer questions 4 through 6 based on the above information 5- The future worth cost is closest to : Select one: a. $ 170,080 O b. $ 184,082 O c.$ 195,500 d. $ 165,000New Project Analysis Expected Salvage $ Cost Use, Years Value New Equipment 70,000.0 3.0 30,000.0 Install Cost, New Equipment 15,000.0 Increase, Net Working Capital 4,000.0 Before-Tax Cost-Savings/Year 25,000.0 Marginal Tax Rate 40.00% Cost Of Capital 10.00% Year 1 Year 2 Year 3 Year 4 3-Year MACRS Depreciation 33.33% 44.45% 14.81% 7.41% Answers Year 1 Year 2 Year 3 Depreciation Tax Savings/Year After Tax Cost Savings/Year Year 3 Book Value Taxes On Sale, Year 3 After-Tax Salvage Value Additional Year 3 Cash Flow Year 0 Year 1 Year 2 Year 3 Net Cash Flow Net Cash Flow Net Present Value 'NPV' Purchase System?
- Consider the following information: Initial cost of equipment $108,000 Sales tax and delivery costs $7,000 Estimated life 7 years Salvage value $11,000 Annual cash inflows $31,000 Estimated cost of capital 10% Without considering the effect of income taxes, the net present value of the equipment is: O $48,566. $41,566. $39,921. $42,921.Estimated sales Sales Price per can Cost per can Estimated life Fixed costs Tax rate Initial equipment cost Initial equipment cost will be linearly depreciated over 4 year life with $10,000 salvage value Investment in NWC 50,000 cans $6.00 $3.00 4 years $10,000/year $100,050 $196,500 $116,000 $153,200 $90,000 Cost of capital What is the operating cash flow? $20,000 20% 10%Cost of equipment: $80,000 Expected annual cost savings to be provided by new equipment: $32,000 Useful life of the equipment: 6 years Salvage value at the end of 6 years: $5000 • Cost of capital: 16% Required: A. What would be the net present value (NPV) of new Machine