a.  Prepare a differential analysis dated May 4 to determine whether to Continue with Old Machine (Alternative 1) or Replace Old Machine (Alternative 2). Prepare the analysis over the useful life of the new machine. If an amount is zero, enter "0". For those boxes in which you must enter subtracted or negative numbers use a minus sign. Differential AnalysisContinue with Old Machine (Alt. 1) or Replace Old Machine (Alt. 2)May 4   Continue with Old Machine (Alternative 1) Replace Old Machine (Alternative 2) Differential Effects (Alternative 2) Revenues:       Sales (5 years) $fill in the blank 67b7a8fe007a05d_1 $fill in the blank 67b7a8fe007a05d_2 $fill in the blank 67b7a8fe007a05d_3 Costs:       Purchase price fill in the blank 67b7a8fe007a05d_4 fill in the blank 67b7a8fe007a05d_5 fill in the blank 67b7a8fe007a05d_6 Direct materials (5 years) fill in the blank 67b7a8fe007a05d_7 fill in the blank 67b7a8fe007a05d_8 fill in the blank 67b7a8fe007a05d_9 Direct labor (5 years) fill in the blank 67b7a8fe007a05d_10 fill in the blank 67b7a8fe007a05d_11 fill in the blank 67b7a8fe007a05d_12 Power and maintenance (5 years) fill in the blank 67b7a8fe007a05d_13 fill in the blank 67b7a8fe007a05d_14 fill in the blank 67b7a8fe007a05d_15 Taxes, insurance, etc. (5 years) fill in the blank 67b7a8fe007a05d_16 fill in the blank 67b7a8fe007a05d_17 fill in the blank 67b7a8fe007a05d_18 Selling and admin. expenses (5 years) fill in the blank 67b7a8fe007a05d_19 fill in the blank 67b7a8fe007a05d_20 fill in the blank 67b7a8fe007a05d_21 Profit (loss) $fill in the blank 67b7a8fe007a05d_22 $fill in the blank 67b7a8fe007a05d_23 $fill in the blank 67b7a8fe007a05d_24   b.  Based only on the data presented, should the proposal be accepted?   c.  Differences in capacity between the two alternatives is     to consider before a final decision is made.

The Everly Equipment Company's flange-lipping machine was purchased 5 years ago for $65,000. It had an expected life of 10 years when it was bought and its remaining depreciation is $6,500 per year for each year of its remaining life. As older flange-lippers are robust and useful machines, this one can be sold for $20,000 at the end of its useful life. A new high-efficiency digital-controlled flange-lipper can be purchased for $110,000, including installation costs. During its 5-year life, it will reduce cash operating expenses by $35,000 per year, although it will not affect sales. At the end of its useful life, the high-efficiency machine is estimated to be worthless. MACRS depreciation will be used, and the machine will be depreciated over its 3-year class life rather than its 5-year economic life, so the applicable depreciation rates are 33.33%, 44.45%, 14.81%, and 7.41%. The old machine can be sold today for $45,000. The firm's tax rate is 25%, and the appropriate cost of capital…

A critical machine in BHP Billiton's copper refining operation was purchased 7 years ago for $160,000. Last year a replacement study was performed with the decision to retain it for 3 more years. The situation has changed. The equipment is estimated to have a value of $8000 if "scavenged" for parts now or anytime in the future. If kept in service, it can be minimally upgraded at a cost of $43,000 to make it usable for up to 2 more years. Its operating cost is estimated at $22,000 in the first year and $29,000 in the second year. Alternatively, the company can purchase a new system, the challenger, that will have an AWC of $-51,000 over its ESL. Use a MARR of 10% per year and annual worth analysis to determine when the company should replace the machine. The AW value of the challenger is $- ◻ ◻ and the AW value of the defender at the end of year 2 is $- 82,834.71 ◻ The company should replace the machine ◻ after two years A critical machine in BHP Billiton's copper refining operation was…

An old machine that originally cost $9,500 thus far has accumulated depreciation of$1,900. The remaining useful life is four years, with no salvage value at the end of itsuseful life. A new machine is now available that costs $8,500, with a useful life of fiveyears and no residual value. The old machine could be sold now for $1,400. The annualcash operating costs for the old machine are $5,000, but for the new machine theywould be only $2,500. Gross revenue from the products would be $12,000 annually foreither machine. The company shouldA) keep the old machine to avoid a $6,200 loss on its disposal.B) replace the old machine.C) keep the old machine to avoid an $8,500 decrease in cash.D) keep the old machine to avoid a $1,400 loss on its disposal.

Kim Kwon Digital Components Company assembles circuit boards by using a manually operated machine to insert electronic components. The original cost of the machine is $94,400, the accumulated depreciation is $37,800, its remaining useful life is five years, and its residual value is negligible. On May 4 of the current year, a proposal was made to replace the present manufacturing procedure with a fully automatic machine that has a purchase price of $196,400. The automatic machine has an estimated useful life of five years and no significant residual value. For use in evaluating the proposal, the accountant accumulated the following annual data on present and proposed operations:   Present Operations   Proposed Operations   Sales $299,200   $299,200   Direct materials $102,000   $102,000   Direct labor 70,800   —   Power and maintenance 6,600   34,900   Taxes, insurance, etc. 2,400   7,800   Selling and administrative expenses 70,800   70,800   Total expenses $252,600…

The Everly Equipment Company’s flange-lipping machine was purchased 5 years ago for $55,000. It had an expected life of 10 years when it was bought, and its remaining depre-ciation is $5,500 per year for each year of its remaining life. As older flange-lippers are robust and useful machines, this one can be sold for $20,000 at the end of its useful life. A new high-efficiency, digital-controlled flange-lipper can be purchased for $120,000, including installation costs. During its 5-year life, it will reduce cash operating expenses by $30,000 per year, although it will not affect sales. At the end of its useful life, the high-efficiency machine is estimated to be worthless. MACRS depreciation will be used, and the machine will be depreciated over its 3-year class life rather than its 5-year economic life, so the applicable depreciation rates are 33.33%, 44.45%, 14.81%, and 7.41%. The old machine can be sold today for $35,000. The firm’s tax rate is 25%, and the appropriate cost of…

St. Johns River Shipyards' welding machine is 15 years old, fully depreciated, and has no salvage value. However, even though it is old, it is still functional as originally designed and can be used for quite a while longer. A new welder will cost $181, 500 and have an estimated life of 8 years with no salvage value. The new welder will be much more efficient, however, and this enhanced efficiency will increase earnings before depreciation from $28,000 to $73, 500 per year. The new machine will be depreciated over its 5- year MACRS recovery period, so the applicable depreciation rates are 20.00%, 32.00%, 19.20%, 11.52 %, 11.52 %, and 5.76%. The applicable corporate tax rate is 25%, and the project cost of capital is 10%. What is the NPV if the firm replaces the old welder with the new one? Do not round intermediate calculations. Round your answer to the nearest dollar. Negative value, if any, should be indicated by a minus sign. F1 Inflation Adjustments The Rodriguez Company is…

Bison Gear and Engineering of St Charles, Illinois, makes sensorless and brushless dc gear motors suited for foodservice equipment, factory automation, alternative energy systems, and other specialty machinery applications. The company purchased an asset 2 years ago that has a 5-year recovery period. The MACRS depreciation charge for year 3 is $14,592. (a) What was the first cost of the asset? (b) Develop the entire MACRS schedule for the asset and determine the depreciation charge in year 1 and next year.

Plz show work no plagiarism please

Management of Plascencia Corporation is considering whether to purchase a new model 370 machine costing $511,000 or a new model 220 machine costing $471,000 to replace a machine that was purchased 7 years ago for $503,000. The old machine was used to make product I43L until it broke down last week. Unfortunately, the old machine cannot be repaired. Management has decided to buy the new model 220 machine. It has less capacity than the new model 370 machine, but its capacity is sufficient to continue making product I43L. Management also considered, but rejected, the alternative of simply dropping product I43L. If that were done, instead of investing $471,000 in the new machine, the money could be invested in a project that would return a total of $479,000.   In making the decision to invest in the model 220 machine, the opportunity cost was:   Multiple Choice   $503,000   $471,000   $511,000   $479,000