Determine The Calculation of NPV

Assignment Help Accounting Basics
Reference no: EM132459600

Denny Inc enjoys a steady demand for stainless steel infiltrators used in a number of chemical processes. Revenues from the infiltrator division are $45 million a year and production costs are $42 million. However, the 10 high-precision Munster stamping machines used in the production process are coming to the end of their useful life. One possibility is simply to replace each existing machine with a new Munster. These machines would cost $500,000 each and would not involve any additional operating costs. The alternative is to buy 10 centrally controlled Skilboro stampers. Skilboros cost $0.9 million each, but unlike the Munster they would produce a total saving in operator and material costs of $300,000 a year. Moreover, the Skilboro is sturdily built and would last 10 years, as against an estimated 7-year life for the Munster.

Question 1: Show The Calculation of NPV ,IRR and Payback period of both MUnster and skilboro and tell which is more beneficial ?

Reference no: EM132459600

Questions Cloud

Determine the generally accepted accounting principles : Determine the Generally Accepted Accounting Principles,The Borg held the property for 10 years during which time the Borg collectively estimated
Describe appearance of the breasts in postmenopausal women : Describe the appearance of the breasts in postmenopausal women. Create a chart that compares and contrasts the following conditions: Fibrocystic disease.
How much did the investor have to deposit on the investment : An investor sold six contracts of June/2018 corn. The price per bushel was $1.62, and each contract was for 5000 bushels.
What is the cash collection for may 2019 : The company's cash collection is as follows: 63% is collected in the same month and the remainder in the next month. What is the cash collection for May 2019?
Determine The Calculation of NPV : Determine and find The Calculation of NPV ,IRR and Payback period of both MUnster and skilboro and tell which is more beneficial ?
Changes in interest rates over the next two months : How should the portfolio manager immunize the portfolio against changes in interest rates over the next two months?
Discuss about the professional identity and stewardship : What is your role as a health care team member? How do you define professionalism and how does professional responsibility influence your work?
What is the value of the swap to the party paying sterling : What is the value of the swap to the party paying sterling? What is the value of the swap to the party paying dollars?
Identify each performance measure as favorable : Explain why you would want the financial statements to be audited.Identify each performance measure as favorable or unfavorable and explain the significance

Reviews

Write a Review

Accounting Basics Questions & Answers

  Month of the operation of business

Bridgette Keyes is a licensed dentist. During the first month of the operation of her business, the following events and transactions occurred.

  Compute warren actual return on plan assets

For Warren Corporation, year-end plan assets were $2,000,000. At the beginning of the year, plan assets were $1,780,000.

  On december 1 year 1 bradley corporation incurs a 15-year

on december 1 year 1 bradley corporation incurs a 15-year 270000 mortgage liability in conjunction with the acquisition

  Pt angushas purchased three delivery trucks

In the recent years, PT Angushas purchased three delivery trucks. Because of frequent employee turnover in the accounting department, a different accountant was in charge of selecting the depreciation method of each delivery truck, and various met..

  Advantages and disadvantages of the c corporation form of do

1) What are the tax advantages and disadvantages of the C corporation form of doing business . List at least 2advantages and 2 disadvantages. Explain each item on your list with an example.

  The job order cost sheets used by tarzan company revealed

the job order cost sheets used by tarzan company revealed the followingjob. no.bal. may 1may production

  Triike company has offered to sell to unicorn magic 10000

unicorn magic manufactures a part for use in its production of stuffed toys. when 10000 items are produced the costs

  Preparing the annual budget

Sales managers are developing estimates of next year's demand for the company's newest line of LCD televisions. This information will be used in preparing the annual budget.

  Determining the percentage change from nominal

If you used a variation of one of the drain resistors to reduce the output offset to zero and thereby compensate for the uncertainties (including that of the other RD), what percentage change from nominal would you require?

  Challenger factory produces two similar products - regular

challenger factory produces two similar products - regular widgets and deluxe widgets. the total plant overhead budget

  An extremely important concept in queueing models

An extremely important concept in queueing models is the difference between rates and times. If λ represents a rate (customers per hour, say), then argue why 1 is a time and vice versa.

  What are sopa and pipa

What are SOPA and PIPA? What is their common goal? What else do they have in common?

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd