Preston Co. is considering acquiring a manufacturing plant. The purchase price is $ 1,100,000. The owners believe
Question:
Preston Co. is considering acquiring a manufacturing plant. The purchase price is $ 1,100,000. The owners believe the plant will generate net cash inflows of $ 297,000 annually. It will have to be replaced in six years. Use the payback method to determine whether Preston should purchase this plant. Round to one decimal place.
Fantastic news! We've Found the answer you've been seeking!
Step by Step Answer:
Answer rating: 76% (13 reviews)
Payback Amount invested Expected annual net cash inflow 11000...View the full answer
Answered By
Khurram shahzad
I am an experienced tutor and have more than 7 years’ experience in the field of tutoring. My areas of expertise are Technology, statistics tasks I also tutor in Social Sciences, Humanities, Marketing, Project Management, Geology, Earth Sciences, Life Sciences, Computer Sciences, Physics, Psychology, Law Engineering, Media Studies, IR and many others.
I have been writing blogs, Tech news article, and listicles for American and UK based websites.
4.90+
5+ Reviews
17+ Question Solved
Related Book For
Horngrens Financial and Managerial Accounting
ISBN: 978-0133255584
4th Edition
Authors: Tracie L. Nobles, Brenda L. Mattison, Ella Mae Matsumura
Question Posted:
Students also viewed these Corporate Finance questions
-
A manufacturing company is considering acquiring a new injection-molding machine at I cost of $120,000. Because of a rapid change in product mix, the need for this particular machine is expected to...
-
The B.C. Port Authority is considering acquiring a new ferry at a cost of $122 million. Equal payments are to be made annually over 40 years and the implied interest rate is 5%. Required: (a)...
-
The Ford Construction Company is considering acquiring a new earthmover. The mover's basic price is $90,000, and it will cost another $18,000 to modify it for special use by the company. This...
-
"Assault on college campuses can no longer remain just a female issue, and universities nationwide must prepare males for the same protections it provides their female counterparts in college Title...
-
A molecule XF6 (having no lone pairs) has a dipole moment of zero. (X denotes an unidentified element.) When two atoms of fluorine have been taken away, you get the molecule XF4, which has dipole...
-
Suppose your firm has decided to use a divisional WACC approach to analyze projects. The firm currently has four divisions, A through D, with average betas for each division of 0.6, 1.0, 1.3, and...
-
Consider the multiple linear regression model \[ y=\beta_{0}+\beta_{1} x_{1}+\beta_{2} x_{2}+\beta_{3} x_{3}+\beta_{4} x_{4}+\varepsilon \] Using the procedure for testing a general linear...
-
The following items were taken from the financial statements of R. Stevens Company. (All dollars are in thousands.) InstructionsPrepare a classified balance sheet in good form as of December 31,2010....
-
On January 1, 2023, Stream Company acquired 25 percent of the outstanding voting shares of Q-Video, Incorporated, for $718,000. Q- Video manufactures specialty cables for computer monitors. On that...
-
A brass bar (E = 100 GPa) with a square cross section is subjected to axial force having a resultant P acting at distance e from the center (see figure). The bar is pin supported at the ends and is...
-
Consider the following three projects. All three have an initial investment of $ 600,000. Requirements 1. Determine the payback period of each project. Rank the projects from most desirable to least...
-
Using payback to make capital investment decisions Robinson Hardware is adding a new product line that will require an investment of $ 1,454,000. Managers estimate that this investment will have a...
-
For the following exercises, sketch the graphs of each pair of functions on the same axis. f(x) = log(x) and g(x) = 10 x
-
As a motivated, ambitious employee, you naturally care about your performance on the joband about making sure your performance is being fairly judged and rewarded. Unfortunately, the company has gone...
-
You work for a large, publicly owned organization that procures many services from organizations based both nationally and more locally to your offices. For many years your offices have been supplied...
-
Analyze the strengths and weaknesses of this message, and then revise it so that it follows this chapters guidelines for sharing routine information, including using the direct approach: Those of you...
-
A carefully constructed series of tweets can serve as a summary of a blog post, video, or other message or document. Your task: Find any article, podcast, video, or webpage on a business topic that...
-
Your company markets a line of rugged smartphone cases designed to protect the sensitive devices from drops, spills, and other common accidents. Your guarantee states that you will reimburse...
-
Satellite A orbits a planet with a speed of 10,000 m/s. Satellite B is twice as massive as satellite A and orbits at twice the distance from the center of the planet. What is the speed of satellite B?
-
On January 1, 2018, Khalid Ltd., which follows IAS 17, entered into an eight-year lease agreement for three dryers. Annual lease payments for the equipment are $28,500 at the beginning of each lease...
-
An audio system processes samples at a rate of 44.1 kHz. At what rate could we sample the systems front panel to both simplify analysis of the system schedule and provide adequate response to the...
-
Steel It began January with 55 units of iron inventory that cost $35 each. During January, the company completed the following inventory transactions: Requirements 1. Prepare a perpetual inventory...
-
Some of L and K Electronics's merchandise is gathering dust. It is now December 31, 2018, and the current replacement cost of the ending merchandise inventory is $32,000 below the business's cost of...
-
Antique Carpets's books show the following data. In early 2020, auditors found that the ending merchandise inventory for 2017 was understated by $8,000 and that the ending merchandise inventory for...
-
Non-liquidating distributions can be dividends, return of capital, or capital gain income to a shareholder. What type of distribution would be capital gain?
-
TranscribedText: Req A1 Req A2 Req C1 Req C2 Req D1 Req D2 Complete the table under the current cost system. (Round your intermediate calculations and final answers to 2 decimal places. Negative...
-
Anton's Fresh Fish and Produce is a wholesale distributor that operates in central Florida. An analysis of two of the company's customers, Seaside Spa and Sigma Assisted Living, reveals the data that...
Study smarter with the SolutionInn App