Reference no: EM131460683
You must evaluate a proposal to buy a new milling machine. The base price is $175,000, and shipping and installation costs would add another $11,000. The machine falls into the MACRS 3-year class, and it would be sold after 3 years for $61,250. The applicable depreciation rates are 33%, 45%, 15%, and 7%. The machine would require a $3,000 increase in net operating working capital (increased inventory less increased accounts payable). There would be no effect on revenues, but pretax labor costs would decline by $44,000 per year. The marginal tax rate is 35%, and the WACC is 12%. Also, the firm spent $5,000 last year investigating the feasibility of using the machine.
What is the initial investment outlay for the machine for capital budgeting purposes, that is, what is the Year 0 project cash flow? Round your answer to the nearest cent.
$
What are the project's annual cash flows during Years 1, 2, and 3? Round your answer to the nearest cent. Do not round your intermediate calculations.
Year 1 $
Year 2 $
Year 3 $
|
Correct for bond currently selling at a premium
: Which one of the following must be correct for a bond currently selling at a premium?
|
|
Discuss whether or not natalie analysis is based on sample
: Natalie Min is a business student in the Haas School of Business at Berkeley. She wishes to pursue an MBA from Berkeley and wants to know the profile of other.
|
|
Construct the appropriate graph for the new variable
: Construct the appropriate graph(s) for the new variable, sugar. Calculate the mean and median of the new variable, and their standard deviations.
|
|
Analysis of two cultural paths to adulthood
: Briefly describe the two identified cultures, including important characteristics such as geographical location, religion(s), and political powers.
|
|
Initial investment outlay for machine for capital budgeting
: What is initial investment outlay for machine for capital budgeting purposes, What is the initial investment outlay for machine for capital budgeting purposes.
|
|
Discuss the sampling bias in the given sampling strategies
: Vons, a large supermarket in Grover Beach, California, is considering extending its store hours from 7:00 am to midnight, seven days a week, to 6:00 am.
|
|
Who was the companys auditor and where is it located
: Who was the company's auditor and where is it located? Who is responsible for the preparation of and information within the company's financial statement?
|
|
Comparing your own path to adulthood
: Identify the generation of yourself and your chosen grandparent (or similar elder) based on the terminology from Pew Research Center (2015) and similar resources.
|
|
Norwegian krone to prevent arbitrage
: What would the six-month forward rate have to be on the Norwegian krone to prevent arbitrage?
|