Mio is going to buy a new machine for manufacturing its product: Machine A has a first cost of P50,000; annual maintenance P6,000; life 12 years and salvage value of P2,000. Machine B has a first cost of P140,000; annual maintenance P2,500, life 36 years and salvage value P10,000. Money is worth 9% .Compute the annual cost of machine A

Q: 1. Disregarding the revenue, what is the future value of the machine cost? 2. What is the present…

A: Since you have posted a question with multiple sub-parts, we will solve the first three sub-parts…

Q: A new drill press costs $12,000. It would potentially produce an additional $4,000 of revenue per…

A: Costs = $12,000 Revenue = $4,000 Operating Expenses = $1,200 Time period = 8 years  Rate = 10%

Q: A machine costs £15,000 and its useful economic life is 5 years. After 5 years, the machine’s scrap…

A: GIVEN, cost = 15000 n=5  net cash inflow = 5000 machine scrap = 3000

Q: Trek Industries purchases new machinery to replace some of its old machinery. The new machinery…

A: Simple rate of return is calculated by dividing the Net operating income by the initial investment.…

Q: A customer is going to buy a brand new pump and motor. It has an initial cost of $10,000. The…

A: To break even, present value of inflows shall be equal to the initial cost of the project.

Q: Use the following for the next 2 questions: A facility is to be built with construction costs of…

A: Variable cost means the cost which vary with the level of output and fixed cost means the cost which…

Q: An engineering consultancy firm makes an economic analysis of two machines that will be purchased.…

A: Machine A Economic Life = 6 years Initial Cost = 10,000 Annual Insurance Cost = 1% of Initial Cost =…

Q: A new machine that will lead tø savings in labour costs of $16,000 per year can be pur- chased for…

A: Before accepting any capital investment projects, a company should carry out an NPV analysis. Net…

Q: A widget machine will cost $480,000.  The anticipated increase in revenue will be $140,000/year for…

A: Cost of the machine = $480000 Revenue increase for 5 years = $140000 Annual expenses for 5 years =…

Q: A owner would be able to increase his firm's yearly profits if it purchases a new machine. If the…

A: Yearly profits = $25,000Year of starting = 3Salvage value = $80,000Interest rate = 8.5%To find: The…

Q: 2. Company A contemplates on taking a project which costs Php5 M. The equipment to be purchased will…

A: Hi, since you have posted multiple questions, we will answer the first one, as per authoring…

Q: 2. Two equipment are to be evaluated. Equipment A cost P500,000 will last for 20 years and have a…

A: Increment cost is 1.8 times and Incremental production rate is 2 times so Equipment B is more…

Q: A certain machine costs GH¢25000 and lasts 6 years, after which time it has a scrap value of…

A: A capitalized cost of an asset is the cost incurred on an asset to put it to use. Capitalized cost…

Q: A printing machine is bought at P 1.3 million and is estimated to have a salvage value of P100,000…

A:

Q: A new machine is expected to save $33,400 annually in labor can be justified for the purchase of…

A: In this we need to find out the Present value of savings.

Q: A businessman wants to upgrade his factory to increase its work production. He thinks of two…

A: The annual cost that is equivalent to all costs that incurred during the life of equipment is…

Q: A company will invest in a machine worth 50000$ to produce a new product. The economic life of the…

A: Net cash flows from purchase of machine will be total cash inflows generated by use of machine and…

Q: A logistics firm is planning to acquire a winching machine which costs $85000 having life span of 6…

A: Cost of Capital :— Cost of capital represents the return a company needs to achieve in order to…

Q: .Calculate the NPV method and discount rate of 12%

A: Net Present Value (NPV) is a capital budgeting technique used for finding the profitability of the…

Q: A company is going to buy a new machine for manufacturing its products. Three machines are…

A: There are different methods to compare the worth of the projects. These methods include 1. Present…

Q: A precision lathe costs $10,400 and will cost $22,000 a year to operate and maintain. If the…

A: Equivalent annual cost is the cost of operating and maintaining an asset annually. It is also called…

Q: The NUBD Co. is planning to purchase a new machine. The payback period will be 6 years. The cash…

A: Pay back period means cost of asset is recovered in that period through CFAT. Therefore in the above…

Q: A new machine requires an investment of $630,000 and will generate $100,000 in cash inflows for 7…

A: The Net Present value iscalculated with the help of following formula Net Present Value = Present…

Q: 4. A company is paying $30 per part for welding operations. They can buy a welding machine with an…

A: Operating cost- Operating costs are connected with the maintenance and management of a business on a…

Q: A widget machine will cost $480,000.  The anticipated increase in revenue will be $140,000/year for…

A: Internal rate of return is the rate expressed in percentage terms which equalize the net present…

Q: Automating a process will cost $8000 now, but it will save $2200 annually for 5 years. The machinery…

A: Net present value method (NPV): Net present value method is the method which is used to compare the…

Q: Mr Dela Cruz is going to buy a new machine for manufacturing its product: Machine A has a first cost…

A: The net gain or loss of an investment over a specific time period, stated as a percentage of the…

Q: An aggregate crasher is expected to cost P60, 000 and has an estimatedlife of 5 years. Maintenance…

A: Here we will use the concept of time value of money. As per the concept of time value of money the…

Q: The purchasing price of the second-hand bulldozer is $100,000. It will have 8 years service life…

A: The present value of all costs is divided by the present value annuity factor.

Q: machine cost is $50,000. fuel and minor repair cost is cost is # 15.00 per hour. A set of tire costs…

A: Salvage value is the expected book value of an asset after depreciation, based on what the firm…

Q: A new machine costs $10 000. Maintenance costs $2000 per year and labour savings are $6567 per year.…

A: The payback period alludes to what extent it takes for a speculator to hit breakeven to recoup the…

Q: for 6 years and has a salvage value of P 30, 000.00. How much could an investor afford to pay for

A: Equivalent annual cost is important in decision making and that have lower annual cost are best…

Q: A solar lighting system is to be purchased and installed for 310,000. This system will save…

A: PW is one of the methods of evaluating the profitability of the project. It considered the PV of…

Q: You are considering a four-year project to improve production efficiency of your press. Buying a new…

A: Frist you need to calculate deperciation on machine and tax saving on sale of sale. Depreciation…

Q: Use the PW method. Show the cash flow diagram if necessary and complete solution. Do not use excel…

A: i)  Present worthIt is not worthwhile to purchase the new machine because its present worth is less…

Q: The initial cost of a new machine is $10,000. The annual operating cost is $1,000/yr for first 3…

A: Equivalent uniform annual cost EUAC distributes the total cost of the project in term of annual cost…

Q: A new die press machine costs $ 150,000, and lasts 8 years with salvage value of $20,000. Annual…

A: We need to use present worth (PW) formula below to calculate the minimum annual revenue required…