What is annual worth of each alternative

Assignment Help Financial Management

Reference no: EM131326953

DelRay Foods must purchase a new gumdrop machine. Two machines are available. Machine 7745 has a first cost of $8,200, an estimated life of 10 years, a salvage value of $1,000, and annual operating costs estimated at $0.01 per 1,000 gumdrops. Machine A37Y has a first cost of $8,000, a life of 10 years, and no salvage value. Its annual operating costs will be $280 regardless of the number of gumdrops produced. MARR is 6%/year, and 30 million gumdrops ware produced each year. What is the annual worth of each alternative? Machine 7745 AW= $ Machine A37Y AW= $

Reference no: EM131326953

Questions Cloud

Using capm what is the cost of retained earnings : Steves specialties INC paid its dividend yesterday of $4.00. The dividend has been growing at a rate of 0.010 and is expected to contiue growing at that rate indefinatly. Steves common stock is currently trading at $22.00 per share. The firms beta is..

What is steves cost of retained earnings : Steves specialties inc paid its dividend yesterday, which was $3.50. The dividend has been growing at a rate of 0.010 and is excpected to keep growing indefinatly at that rat. Steves common stock is currently trading at $22.00 per share. The firms be..

The yield to maturity on similar bonds is estimated : Karen wants to buy a 10-year, AAA-rated, $1,000 par value, zero-coupon bond being sold by Downsize Industries, Inc. The yield to maturity on similar bonds is estimated to be 5.8%. How much would he have to pay for the bond (interest is compounded sem..

Calculate the annual compound growth rate : “Before there was Paris Hilton, there was Consuelo Vanderbilt Balsan – a Gilded Age heiress and socialite, re-nowned for her beauty and wealth. Now Ms. Balsan’s onetime Hamptons home is slated to hit the market priced at $28 million with Tim Davis of..

What is annual worth of each alternative : DelRay Foods must purchase a new gumdrop machine. Two machines are available. Machine 7745 has a first cost of $8,200, an estimated life of 10 years, a salvage value of $1,000, and annual operating costs estimated at $0.01 per 1,000 gumdrops. What is..

What is bobs cost of preferred stock : Bobs stuff INC has prefered stock with a stated dividend of $3.24, which is currently trading at $25 per share. Bob beleives the company can issue additional stocks at that price net. What is Bobs cost of preferred stock?

What is yield to maturity if bond pays semiannual coupon : What is the yield to maturity of a $1,000 par value bond that is currently selling for $857 if the annual coupon rate is 4.8% and the bond has 4 years to maturity? Also What is the yield to maturity if the bond pays a semiannual coupon?

What is the yield to maturity : What is the yield to maturity of a $1,000 par value bond that is currently selling for $857 if the annual coupon rate is 4.8% and the bond has 4 years to maturity?

Maturity and pays an annual coupon interest rate : What is the value of a $1,000 par value bond that has 6 years left to maturity and pays an annual coupon interest rate of 7.6% if bonds of similar risk are yielding 5.5%?

User Account

All Pages