Question: Larson Manufacturing is considering purchasing a new injection-molding machine for $360,000 to expand its production capacity. It will cost an additional $25,000 to do

Larson Manufacturing is considering purchasing a new injection-molding machine for ( $ 360,000 ) to expand its production

Larson Manufacturing is considering purchasing a new injection-molding machine for $360,000 to expand its production capacity. It will cost an additional $25,000 to do the site preparation. With the new injection-molding machine installed, Larson Manufacturing expects to increase its revenue by $97,000 per year. The machine will be used for four years, with an expected salvage value of $67,000. At an interest rate of 8%, would the purchase of the injection-molding machine be justified? Click the icon to view the interest factors for discrete compounding when i = 8% per year. The present worth of the project is (Round to the nearest dollar.)

Step by Step Solution

★★★★★

3.58 Rating (172 Votes )

There are 3 Steps involved in it

1 Expert Approved Answer

Step: 1 Unlock

To determine whether the purchase of the injectionmolding machine is justified well calculate the pr... View full answer

Question Has Been Solved by an Expert!

Get step-by-step solutions from verified subject matter experts

Step: 2 Unlock

Step: 3 Unlock

Students Have Also Explored These Related Business Communication Questions!

LinkedIn is an online professional networking site, much like Facebook or MySpace, except that its for connecting with classmates and colleagues to create networks that may be helpful in, among other...

Online magazines make it easy for readers to link to an advertiser's website directly from an advertisement placed in the digital magazine. A recent survey indicated that 56% of online magazine...

Find a communication example that you believe could be improved by applying the visual design principles you learned in this chapter. It can be from any medium-a webpage, a magazine ad, a promotional...

Determine the incremental rate of return for Problem 7. Which track hoe should your company choose? In Problem 7, your company needs to purchase a new track hoe and has narrowed the selection to two...

Your company needs to purchase a new track hoe and has narrowed the selection to two pieces of equipment. The first track hoe costs $100,000 and costs $32.00 per hour to operate. The second track hoe...

Klamath Company, a manufacturer of ballet shoes, is experiencing a period of sustained growth. In an effort to expand its production capacity to meet the increased demand for its product, the company...

Kang Company, a manufacturer of ballet shoes, is experiencing a period of sustained growth. In an effort to expand its production capacity to meet the increased demand for its product, the company...

Purchases by Deferred Payment, Lump-Sum, and Nonmonetary Exchanges Klamath Company, a manufacturer of ballet shoes, is experiencing a period of sustained growth. In an effort to expand its production...

The following transactions relate to Direct Towing Service. Assume the transactions for the purchase of the wrecker and any capital improvements occur on January 1 of each year. 2013 1. Acquired...

The following transactions relate to Academy Towing Service. Assume the transactions for the purchase of the wrecker and any capital improvements occur on January 1 of each year. 2016 1. Acquired...

Write a report on the topic: How to Start a Jewelry Making Business

a) Define Philips curve. (2 marks) b) Suppose an economy has the following Philips curve: = -0.5(u - 0.06). Where; , is the rate of inflation at time t, and u is the rate of unemployment. What is...

Homework: Practice for Test 1 Question 3 4 , Question list % Question 3 2 Question 3 3 Question 3 4 Question 3 5 Question 3 6 Solve the given initial value problem. y ' ' 9 y ' = 0 ; y ( 0 ) = 4 , y...

A steam power plant has 1200 F in the boiler, 630 Btu/s work out of the turbine, 900 Btu/s is taken out at 100 F in the condenser, and the pump work is 30 Btu/s. Find the plants thermal efficiency....

The volume of a gas sample is increased while its temperature is held constant. The gas exerts a lower pressure on the walls of its container because its molecules strike the walls a. less often b....

The financial statements of Apple Inc. are presented in Appendix A at the end of this textbook. Instructions for accessing and using the companys complete annual report, including the notes to the...

Complete the following table by briefly describing how different retail formats could use each of the areas listed to enhance the stores image and atmosphere. Area Drug Store Clothing Store Music...

A 5.0-kg steel gear is heated to 150C and then placed into a 0.5-gal container of water at 10C. What is the final temperature of the metal and water?

How would the value of the measured activation energy be affected if the actual temperature of the solution was lower than that of the water bath

I need only answers within 2 hours. (1) "A clothing retailer plans to automate its payroll processing by using a scanner that identifies which clerks sold which item. Management is excited about this...

"Larson Manufacturing is considering purchasing a new injection-moulding machine to expand its production capacity. There is a one-time cost of $25,000 to perform site preparation for the machine,...

"Larson Manufacturing is considering purchasing a new injection-moulding machine to expand its production capacity. There is a one-time cost of $28,100 to perform site preparation for the machine,...

"Larson Manufacturing is considering purchasing a new injection-moulding machine to expand its production capacity. There is a one-time cost of $34,500 to perform site preparation for the machine,...

Larson Manufacturing is considering purchasing a new injection-molding machine for $250,000 to expand its production capacity. It will cost an additional $20,000 to do the site preparation. With the...

Larson Manufacturing is considering purchasing a new injection-molding machine for $210,000 to expand its production capacity. It will cost an additional $10,000 to do the site preparation. With the...