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- Solve step by step in digital format, explain How would you set up the function in Excel to get the IRR of an investment of $22,500 over 6 years, saving $1,600 per year, with a final payment of $7,800? Option A Option B Initial cost -16,700 -18,500 Annual operating cost -990 -1270 Rescue value 8600 9500 Useful life 10 10Tippy Toe Spa Company offers various services, such facials, laser hair removal and microdermabrasion. Currently, the company is considering purchasing the following spa equipment: Laser Hair Removal Machines Microdermabrasion Machines Facial Oxygen Units $64,500 $27,000 $126,400 $37,800 $91,400 $27,200 11% Cost per Machine Annual Cash Inflow Annual Cash Outflow Required Rate of Return Useful Life Residual Value 4 years $890 $29,700 $212,200 $197,900 14% 3 years $890 Laser Hair Removal Machine: Answer Years Microdermabrasion Machine: Answer Years Facial Oxygen Unit: Answer Years 7% Assume that each equipment's annual cash flow will occur for the period equal to its useful life. Do not enter dollar signs or commas in the input boxes. Use the present values tables in the textbook appendix. Use the negative sign for negative values. Round your answers to the nearest whole number. a) Determine the NPV of each piece of equipment. Laser Hair Removal Machine: $Answer Microdermabrasion…A manufacturing plant manager has purchased a new bologna slicing machine for $24,500. The new machine is expected to produce an extra $8,000 of revenue and have an annual operating expense of $3,000. If the useful life is expected at 6 years and i = 7% per year, what is the PW? Select one: a. $50000 b. $23835 36 c. $35000 d. $ 25000
- Amazon site BFI3 wants to test a new label scanner on their package sorter. The initial investment of the machine will be $2.5 million and the benefit due to cost savings will be $900,000 per year. Normal maintenance on the machine will cost $75,000 per year and they plan for major maintenance in year 7 of $500,000. At the end of the 10 year project life, they are able to sell the parts to another warehouse for $600,000. If the MARR is 11% what is the AEW of this project?You are building a new facility and are trying to determine which vendor you are going to use to install new windows. You get quotes from two vendors-Vendor A and Vendor B. The useful life of the windows is 9.1 years and the MARR is 14%. The annual worth from the quotes are given below. What should you do? Vendor A B AW Save for Later -$6300 -$3200 O Purchase windows from Vendor B. O Purchase windows from Vendor A O Do nothing. Attempts: 0 of 1 used SandTwo alternative means of providing engineering drafting services are under consideration. Handy-Cam R-tistry $200,000 $120/hr $250/hr $20,000 $250,000 $115/hr Purchase Price Operating Cost $250/hr $15,000 Revenue Market value (end of useful life) Useful life 6 years б уears It is anticipated that the chosen alternative wilI be used to generate revenue 8 hrs/day, 250 days per year. The company uses a MARR = 12% for all investments. 12% Interest Table ,
- As an engineer, you have been asked to recommend a new cooling system for a large warehouse. You have narrowed it down to three different systems with the associated costs shown below If the minimum attractive rate of return in 10%, which system would you recommend. Cooling system A В C $250,000 $75,000 $300,000 $60,000 $36,000 $375,000 $80,000 $45,000 9 years Installation costs Annual operating costs Salvage value Lifespan None 5 years 7 yearsCompare the machines below using present worth analysis at i10% per year and find which one should be selected Machine Y First Cost Operating Cost Savage Lfe cycle Machine X 20.000 3.000 3.000 3years Firat Cost 30.000 .000 Annuel Operating Cost Salvage Life cycle 3.000 6 yoarsA warehouse manager is evaluating 2 different robotic systems to be installed in his warehouse. Using the present worth analysis, determine which is the economically better system if MARR is 12% per year compounded monthly. Justify your answer. System A System B - 40,000 -60,000 - 5,000 Initial cost, RM Maintenance cost, RM per month Semi-annual maintenance cost, RM per 6-month Salvage value after 5 years, RM - 13,000 8,000 10,000
- The Fence Company is setting up a new production line to create top rails. The relevant data for two alternatives are shown below. Flow Line Manufacturing Cell Installed Cost Expected Life Salvage Value Variable Cost per Top Rail Click here to access the TVM Factor Table Calculator $15,000 5 years $0 $6.00 $10,000 5 years $0 $7.00We project unit sales for a new household-use laser-guided cockroach search and destroy system as follows: Year 1 2 3 4 5 Check my work Unit Sales 101,000 113,000 136,000 142,000 95,000 The new system will be priced to sell at $475 each. The cockroach eradicator project will require $2,200,000 in net working capital to start, and total net working capital will rise to 15% of the change in sales. The variable cost per unit is $345, and total fixed costs are $2,500,000 per year. The equipment necessary to begin production will cost a total of $22 million. This equipment is mostly industrial machinery and thus qualifies for CCA at a rate of 20%. In five years, this equipment will actually be worth about 20% of its cost. The relevant tax rate is 35%, and the required return is 17%. Based on these preliminary estimates, what is the NPV of the project? (Enter the answer in dollars. Do not round your intermediate calculations. Round the final answer to 2 decimal places. Omit $ sign in your…We project unit sales for a new household-use laser-guided cockroach search and destroy system as follows: Year 1 2 3 4 5 Unit Sales 100, 500 NPV 112,500 135,500 141,500 94,500 The new system will be priced to sell at $470 each. The cockroach eradicator project will require $2,100,000 in net working capital to start, and total net working capital will rise to 15% of - the change in sales. The variable cost per unit is $340, and total fixed costs are $2,400,000 per year. The equipment necessary to begin production will cost a total of $22 million. This equipment is mostly industrial machinery and thus qualifies for CCA at a rate of 20%. In five years, this equipment will actually be worth about 20% of its cost. The relevant tax rate is 35%, and the required return is 16%. Based on these preliminary estimates, what is the NPV of the project? (Enter the answer in dollars. Do not round your intermediate calculations. Round the final answer to 2 decimal places. Omit $ sign in your…