User Account

All Pages

What is the net present value of the system

Assignment Help Accounting Basics
Reference no: EM133184547

Question - A company is considering the purchase of a new machine. The cost of the system is $80,000 and its expected life is 5 years. During that time, the system will generate annual cost savings of $22,000. An upgrade will be performed on the system at the end of the third year at a cost of $15,000.

Required -

(a) What is the payback period of the system?

(b) Assuming the cost of capital is 8% p.a., what is the net present value of the system to the nearest whole dollar?

Reference no: EM133184547

Questions Cloud

Calculate the budgeted cash receipts for the whole year : Quarter 1: Cash collected from last year's Quarter 4 credit sales assumed to be $100,000. Calculate the budgeted cash receipts for the whole year
Demonstrate the use of excel data validation : Demonstrate the use of Excel data validation by producing some useful screenshots. Include formulae to show your understanding of how to use the data validation
How many units were produced : The direct labor rate variance was $9,100 favorable; the direct labor efficiency variance was $15,000 unfavorable. How many units were produced
What amount of solar building included on balance sheet : In 2019 and 2020, Solar had net income of $250,000 and $240,000, respectively. What amount of Solar building included on balance sheet
What is the net present value of the system : During that time, the system will generate annual cost savings of $22,000. Assuming the cost of capital is 8% p.a., what is the net present value
Define industrial policy : Define industrial policy. What are the sub topics embedded in industrial policy? Explain one advantage and one disadvantage of each one of the above.
How much more will you have : Question - How much more will you have if you invest $100,000 over 20 years at 6% compounded monthly versus compounding quarterly
Describe how the results from one of the articles : Choose an article featured on the Correlation or Causation and Describe how the results from one of the articles (preferably a correlation)
Implications of health economic concepts for health care : Analyze the primary potential benefits of learning about health economics related to government involvement in health care economics, financing

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.

  Theory of interest - term structure of interest rates

Term Structure of Interest Rates

  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!

Submit Assignment

Academics

Major Subjects

Majors

Get In Touch

whatsapp: +1-415-670-9521

Phone: +1-415-670-9521

Email: [email protected]

TERMS & POLICIES

HELP & SUPPORT

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd