could you give a correct answer because this is will be the last chance for me to do this Quiz

1

(Ignore income taxes in this problem.) Buy-Rite Pharmacy has purchased a small auto for delivering prescriptions. The auto was purchased for $29,000 and will have a 6-year useful life and a $4,100 salvage value. Delivering prescriptions (which the pharmacy has never done before) should increase gross revenues by at least $32,100 per year. The cost of these prescriptions to the pharmacy will be about $25,200 per year. The pharmacy depreciates all assets using the straight-line method. The payback period for the auto is closest to:

4.8 years

3.6 years

4.2 years

3.2 years

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2

The management of Urbine Corporation is considering the purchase of a machine that would cost $310,000 would last for 5 years, and would have no salvage value. The machine would reduce labor and other costs by $74,000 per year. The company requires a minimum pretax return of 12% on all investment projects. (Ignore income taxes in this problem.)

Click here to view Exhibit 11B-1 and Exhibit 11B-2, to determine the appropriate discount factor(s) using tables.

The net present value of the proposed project is closest to: (Round discount factor(s) to 3 decimal places, intermediate and final answers to the nearest dollar amount.)

$65,910

$3,230

$20,550

$43,230