What dollar value per year would the intangible benefits

Assignment Help Accounting Basics
Reference no: EM132106031

Question - Union Bay Plastics is investigating the purchase of automated equipment that would save $100,000 each year in direct labor and inventory carrying costs. This equipment costs $750,000 and is expected to have a 10-year useful lift with no salvage value. The company's required rate of return is 15% on all equipment purchases. This equipment would provide intangible benefits such as greater flexibility and higher-quality output that are difficult to estimate and yet are quite significant.

Required: What dollar value per year would the intangible benefits have to have in order to make the equipment an acceptable investment?

Reference no: EM132106031

Questions Cloud

Prepare a production budget for the third quarter : Prepare a production budget for the third quarter showing the number of units to be produced each month and for the quarter in total
Discuss the role of social responsibility in small business : Discuss the role of social responsibility in small business.
How large a force s necessary for the component : A man is dragging a trunk up the loading ramp of a mover's truck. The ramp has a slope angle of 20.0 degrees, and the man pulls upward with a force.
Common elements in successful strategies : How has your chosen company performed against the common elements in successful strategies - Focus on strategy in this post and describe your chosen company's
What dollar value per year would the intangible benefits : Required: What dollar value per year would the intangible benefits have to have in order to make the equipment an acceptable investment
Find the inductance of the solenoid : A solenoid is made by winding 1397 turns of wire into a hollow cylinder 1.3 cm in diameter and 12.0 cm in length. Find the inductance of the solenoid.
What is largest component probability : What is the largest component probability that can be achieved?
How many units does the company need to produce : The company had 120,000 units in inventory on December 31, 2015. How many units does the company need to produce during the first quarter of 2016
Additional responses are always appreciated and encouraged : Additional responses are always appreciated and encouraged.

Reviews

Write a Review

Accounting Basics Questions & Answers

  How much control does fed have over this longer real rate

Hubbard argues that the Fed can control the Fed funds rate, but the interest rate that is important for the economy is a longer-term real rate of interest.   How much control does the Fed have over this longer real rate?

  Coures:- fundamental accounting principles

Coures:- Fundamental Accounting Principles: - Explain the goals and uses of special journals.

  Accounting problems

Accounting problems,  Draw a detailed timeline incorporating the dividends, calculate    the exact Payback Period  b)   the discounted Payback Period. the IRR,  the NPV, the Profitability Index.

  Write a report on internal controls

Write a report on Internal Controls

  Prepare the bank reconciliation for company

Prepare the bank reconciliation for company.

  Cost-benefit analysis

Create a cost-benefit analysis to evaluate the project

  Theory of interest

Theory of Interest: NPV, IRR, Nominal and Real, Amortization, Sinking Fund, TWRR, DWRR

  Liquidity and profitability

Distinguish between liquidity and profitability.

  What is the expected risk premium on the portfolio

Your Corp, Inc. has a corporate tax rate of 35%. Please calculate their after tax cost of debt expressed as a percentage. Your Corp, Inc. has several outstanding bond issues all of which require semiannual interest payments.

  Simple interest and compound interest

Simple Interest, Compound interest, discount rate, force of interest, AV, PV

  Capm and venture capital

CAPM and Venture Capital

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