User Account

All Pages

Which of the machines is most attractive based on its

Assignment Help Accounting Basics
Reference no: EM13482369

Heartland Paper Company is considering the purchase of a new high-speed cutting machine. Tow cutting machine manufacturers have approached Heartland with proposals: (1) Toledo Tools and (2) Akron Industries. Regardless of which vendor Heartland chooses, the following incremental cash flows are expected to be realized:

Year                                                              IncrementalCash             Incremental Cash

                                                                         Inflows                            Outflows     

1.......................................................            $26,000                      $20,000

2........................................................            27,000                        21,000

3........................................................            32,000                        26,000

4.........................................................            35,000                        29,000

5.........................................................            34,000                        28,000

6..........................................................            33,000                        27,000

a. If the machine manufactured by Toledo Tools costs $27,000, what is its expected payback period?

b. If the machine manufactured by Akron Industries has a payback period of 66 months, what is its cost?

c. Which of the machines is most attractive based on its respective paybackperiod? Should Heartland base its decision entirely on this criterion? Explain your answer.

Reference no: EM13482369

Questions Cloud

Tanner appliance company manufactures 12600 units of part : tanner appliance company manufactures 12600 units of part m4 annually. the part is used in the production of one of its
As useful as financial statements are they have their : as useful as financial statements are they have their limitations. of course we should be aware of such limitations
The following information pertains to the east division of : the following information pertains to the east division of saturn companynet
However due to uncertantiesregarding foundation funding it : the cost accountant for a drug company has informed you thatthe companys materials quality variance for a allegra was
Which of the machines is most attractive based on its : heartland paper company is considering the purchase of a new high-speed cutting machine. tow cutting machine
Shimmer does not sell any other assets during the year and : shimmer inc is a calendar year end accrual method corporation. this year its sells the following long term assetsassets
Dreamjay aviation has called on your business consulting : dreamjay aviation has called on your business consulting group again for advice. bradley has decided that they should
Walter manufacturing co produces and sells specialized : walter manufacturing co. produces and sells specialized equipment used in the petroleum industry. the company is
Stillwater designs rebuilds defective units of its s12l7 : stillwater designs rebuilds defective units of its s12l7 kicker speaker model. during the year stillwater rebuilt 7500

Reviews

Write a Review

Accounting Basics Questions & Answers

  Contribution margin in the campus store

The contribution margin in the campus store is $110,000. Direct fixed costs are $90,000 in the downtown store and $93,000 in the campus location. How much are total variable costs?

  What is a firm weighted-average cost of capital

What is a firm's weighted-average cost of capital if the stock has a beta of 1.45. Treasury bills yield 5%, and market portfolio offers an expected return of 14%? In addition to equity, the firm finances 30% of its assets with debt that has a yiel..

  Share of the income

They agree to salaries of $12,000 and $18,000 for Singer and McMann respectively and 10% interest on original capital. If they agree to share remaining profits and losses on a 3:2 ratio, what will McMann‘s share of the income be if the income for ..

  What is advertising how many types of advertising

what is advertising?how many types of advertising?advertising is the most important?advertising is the most

  Management of modugno corporation is considering whether to

management of modugno corporation is considering whether to purchase a new model 370 machine costing 441000 or a new

  Depriciation-plant asset occurs during the year

If disposal of a plant asset occurs during the year, depreciation is: a. not recorded for the year. b. recorded for the whole year. c. recorded for the fraction of the year to the date of the disposal. d. not recorded if the asset is scrapped.

  Early extinguishment effective interest lo5the long-term

early extinguishment effective interest ? lo5the long-term liability section of twin digital corporations balance sheet

  Basic cash budget for the month

Management wishes to maintain a minimum cash balance of $8,000. Complete the basic cash budget for the month of January.

  What are the expected collections for july

Sales are 40% cashand 60% credit. All credit sales are collected in the monthfollowing the sale. What are the expected collections for July?

  Veronica company allocates overhead costs to jobs on basis

veronica company allocates overhead costs to jobs on the basis of direct labor-hours. its estimated average monthly

  Individual income tax many people believe that the federal

individual income tax many people believe that the federal income tax is far too complex. but are there good reasons

  Discrepancies between ifrs and u.s. gaap

the U.S. is going global, which is easier with all of our current technology. Using the textbook, and at least 2 other relevant references, (sorry, no Wikipedia) where do you see the U.S. in the next 5 years? When do you estimate IFRS will become man..

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