Machines would cost 153600 and have a usefull life of seven

Reference no: EM13572639

Machines would cost $153,600 and have a usefull life of seven years. The bank's controller has estimated that the machines will save hte bank 32,000 after taxes during each year of their life (including the depreciation tax shield). The machines have no salvage value.

1. What is the payback period for the proposed investment

2. What is the net present value of the proposed invesment assuming an after-tax rate of 10/12/14%

Reference no: EM13572639

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