Business, 15.07.2020 02:01 jessicachichelnitsky

One year ago, your company purchased a machine used in manufacturing for $115,000. You have learned that a new machine is available that offers many advantages and that you can purchase it for $160,000 today. The CCA rate applicable to both machines is 40%; neither machine will have any long-term salvage value.
You expect that the new machine will produce earnings before interest, taxes, depreciation, and amortization (EBITDA) of $45,000 per year for the next 10 years. The
current machine is expected to produce EBITDA of $22,000 per year. All other expenses of the two machines are identical. The market value today of the current
machine is $50,000. Your company's tax rate is 45%, and the opportunity cost of capital for this type of equipment is 12%. Should your company replace its year-old
machine?
What is the NPV of replacement?

Answers: 2

Show answers

Another question on Business

Business, 22.06.2019 11:00

Acompany that adapts its product mix to meet the needs of a new market is using which of the following global marketing strategies market development diversification strategy product development undiversified

Answers: 3

Answer

Business, 22.06.2019 11:10

Yowell company granted a sales discount of $360 to a customer when it collected the amount due on account. yowell uses the perpetual inventory system. which of the following answers reflects the effects on the financial statements of only the discount? assets = liab. + equity rev. − exp. = net inc. cash flow a. (360 ) = na + (360 ) (360 ) − na = (360 ) (360 ) oa b. na = (360 ) + 360 360 − na = 360 na c. (360 ) = na + (360 ) (360 ) − na = (360 ) na d. na = (360 ) + 360 360 − na = 360 na

Answers: 1

Answer

Business, 22.06.2019 20:30

(30 total points) suppose a firm’s production function is given by q = l1/2*k1/2. the marginal product of labor and the marginal product of capital are given by: mpl = 1/ 2 1/ 2 2l k , and mpk = 1/ 2 1/ 2 2k l . a) (12 points) if the price of labor is w = 48, and the price of capital is r = 12, how much labor and capital should the firm hire in order to minimize the cost of production if the firm wants to produce output q = 18?

Answers: 1

Answer

Business, 22.06.2019 22:00

Brody corp. uses a process costing system in which direct materials are added at the beginning of the process and conversion costs are incurred uniformly throughout the process. beginning inventory for january consisted of 1,050 units that were 65% completed. 10,900 units were started into the process during january. on january 31, the inventory consisted of 500 units that were 50% completed. what would be the equivalent units for direct materials cost using the weighted average method?

Answers: 2

Answer

You know the right answer?

One year ago, your company purchased a machine used in manufacturing for $115,000. You have learned...

Questions