Question: a. A new operating system for an existing machine is expected to cost $670,000 and have a useful life of six years. The system yields

a. A new operating system for an existing machine is expected to cost $670,000 and have a useful life of six years. The system yields the system Is $17,600. an Incremental after-tax Income of $220,000 each year after deducting Its straight-line depreciation. The predicted salvage value of b. A machine costs $600,000, has a $39,800 salvage value, Is expected to last eight years, and will generate an after-tax Income of $80,000 per year after straight-line depreciation. Assume the company requires a 10% rate of return on its Investments. Compute the net present value of each potential Investment. (PV of $1, FV of $1, PVA of $1, and FVA of $1) (Use appropriate factor(s) from the tables provided.) Complete this question by entering your answers in the tabs below. Required A Required B A new operating system for an existing machine is expected to cost $670,000 and have a useful life of six years. The system yields an incremental after-tax income of $220,000 each year after deducting its straight-line depreciation. The predicted salvage value of the system is $17,600. (Round your answers to the nearest whole dollar.) Cash Flow Select Chart Amount x PV Factor = Present Value Annual cash flow Present Value of an Annuity of 1 S Residual value Present Value of 1 Present value of cash inflows Immediate cash outflows Net present value Required B >
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