Calculate the EAC for both conveyor belt systems

Assignment Help Financial Management

Reference no: EM131320674

Lang Industrial Systems Company (LISC) is trying to decide between two different conveyor belt systems. System A costs $224,000, has a four-year life, and requires $71,000 in pretax annual operating costs. System B costs $318,000, has a six-year life, and requires $65,000 in pretax annual operating costs. Suppose LISC always needs a conveyor belt system; when one wears out, it must be replaced. Assume the tax rate is 30 percent and the discount rate is 9 percent. Calculate the EAC for both conveyor belt systems. (Negative amounts should be indicated by a minus sign. Do not round intermediate calculations and round your answers to 2 decimal places. (e.g., 32.16)) EAC System A $ System B $

Reference no: EM131320674

Questions Cloud

Calculate the after-tax cost of debt under conditions : Calculate the after-tax cost of debt under each of the following conditions: Interest rate of 14%; tax rate of 0%.

Determine the equivalent circuit : For the structure of Figure 6.10, continue the analysis beyond the quasistatic extension to obtain the input impedance correct to the third power in . Determine the equivalent circuit.

Implications for pricing decisions : What should Sonic's primary pricing objective be? Explain your reasoning. Are smart phone customers like to be price sensitive? What are the implications for your pricing decisions?

List the two primary forms of business franchises : List the two primary forms of business franchises. Which is the simpler form? Which form requires the most complex business relationship

Calculate the EAC for both conveyor belt systems : Lang Industrial Systems Company (LISC) is trying to decide between two different conveyor belt systems. System A costs $224,000, has a four-year life, and requires $71,000 in pretax annual operating costs. Calculate the EAC for both conveyor belt sys..

New debt and used this to buy back stock : Dye Trucking raised $190 million in new debt and used this to buy back stock. After the recap, Dye's stock price is $5.25. If Dye had 70 million shares of stock before the recap, how many shares does it have after the recap? Enter your answer in mill..

Less-affluent consumers in developing countries : To overcome this problem when selling to less-affluent consumers in developing countries, many companies make simpler or smaller versions of their products that can be sold at lower prices. Others have introduced new, more affordable brands for gl..

Write essay on how culture influences peoples attitudes : Write a one-page essay on how culture influences peoples' attitudes toward fire and fire prevention. For instance, in some cultures having a fire in your home is looked at as a shameful event

Write a program that stores an array of five int values : Write a program that stores an array of 5 int values (not Integer), a Date object, and the double value 12.8 into a file named "Assign8_Q1.dat".

User Account

All Pages