es Rust Industrial Systems is trying to decide between two different conveyor belt systems. System A...
Fantastic news! We've Found the answer you've been seeking!
Question:
![image text in transcribed](https://s3.amazonaws.com/si.experts.images/answers/2024/05/66496b6f7c84b_66266496b6ec76db.jpg)
Transcribed Image Text:
es Rust Industrial Systems is trying to decide between two different conveyor belt systems. System A costs $220,000, has a four-year life, and requires $70,000 in pretax annual operating costs. System B costs $312,000, has a six-year life, and requires $64,000 in pretax annual operating costs. Both systems are to be depreciated straight-line to zero over their lives and will have zero salvage value. Whichever system is chosen, it will not be replaced when it wears out. The tax rate is 25 percent and the discount rate is 8 percent. Calculate the NPV for both conveyor belt systems. Note: A negative answer should be indicated by a minus sign. Do not round intermediate calculations and round your answers to 2 decimal places, e.g., 32.16. System A System B Which conveyor belt system should the firm choose? System A System B es Rust Industrial Systems is trying to decide between two different conveyor belt systems. System A costs $220,000, has a four-year life, and requires $70,000 in pretax annual operating costs. System B costs $312,000, has a six-year life, and requires $64,000 in pretax annual operating costs. Both systems are to be depreciated straight-line to zero over their lives and will have zero salvage value. Whichever system is chosen, it will not be replaced when it wears out. The tax rate is 25 percent and the discount rate is 8 percent. Calculate the NPV for both conveyor belt systems. Note: A negative answer should be indicated by a minus sign. Do not round intermediate calculations and round your answers to 2 decimal places, e.g., 32.16. System A System B Which conveyor belt system should the firm choose? System A System B
Expert Answer:
Posted Date:
Students also viewed these finance questions
-
Diagonalize the matrices, if possible. The eigenvalues are as follows: (11) = 1, 2, 3; (12) = 1, 4; (13) = 5, 1; (14) = 3, 4; (15) = 3, 1; (16) = 2, 1. 3 4 6 1
-
In this problem, we will write the FFT as a sequence of matrix operations. Consider the 8-point decimation-in-time FFT algorithm shown in figure. Let a and f denote the input and output vectors,...
-
_________ include franchising, licensing, and patents.
-
How is servant leadership an extension of transformational leadership?
-
The financial statements of Marks and Spencer plc (M&S) are available at the books companion website or can be accessed at corporate.marksandspencer....
-
er of contact lenses, follow for a four - year period. Data table \ table [ [ , , 2 0 2 5 , 2 0 2 4 , 2 0 2 3 , 2 0 2 2 ] , [ Net Sales Revenue,$ , 7 6 2 , 0 0 0 $ , 7 0 5 , 0 0 0 $ , 6 3 9 , 0 0 0 $...
-
Many times, we hear that statistics can't be trusted because it is so easy to manipulate the data so that the outcome favors whatever opinion we want to portray. Recently in the news, Volkswagen was...
-
Eight year-old Alex is learning to ride a horse. The trainer says that a horse ages 5 years for every 2 human years. The horse is now 50 years old in human years. a. Calculate the age of the horse,...
-
Kotter, as cited in Gorchels (2012), describes the work of leaders and the work of managers. Review the following video Develop New ProductsLinks to an external site. , then in your discussion post,...
-
After this week's lecture on leases and other legal issues in real estate, describe why a buyer of property would want an estoppel agreement signed by the existing landlord and tenant, how an...
-
Explain how a leader could use the three components of organizational change guiding an organizational change?
-
In department and specialty store retailing, a common markup strategy is to double the cost of an item to arrive at the selling price. This strategy is known as keystoning the markup and is widely...
-
Suppose you are evaluating an orchid species that exhibits a left-handed lip on the flower or a right-handed lip. Suppose you sample 27 flowers and 16 are left-handed. Using a 1% significance level,...
-
Write the given system without the use of matrices. D) - ()- d (x sin t + 8 (2+ 1)
-
What natural instincts cause some managers to resist detailed comparisons with competitors?
-
How do growth economies differ from scale economies or learning curve effects?
-
What is the significance of strong growth economies among the Fortune 500?
![Mobile App Logo](https://dsd5zvtm8ll6.cloudfront.net/includes/images/mobile/finalLogo.png)
Study smarter with the SolutionInn App