Improve its production efficiency

Assignment Help Cost Accounting

Reference no: EM13176744

CSM Machine Shop is considering a four-year project to improve its production efficiency. Buying a new machine press for $489,000 is estimated to result in $188,000 in annual pretax cost savings. The press falls in the MACRS five-year class (MACRS Table), and it will have a salvage value at the end of the project of $57,000. The press also requires an initial investment in spare parts inventory of $21,400, along with an additional $3,400 in inventory for each succeeding year of the project. The shop's tax rate is 30 percent and its discount rate is 12 percent.

Compute NVP.(Do not include the dollar sign ($).Enter rounded answer as directed, but do not use the rounded numbers in intermediate calculations.Round your answer to 2 decimal places (e.g., 32.16).)

Reference no: EM13176744

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