Question: please explain each step Casplan Sea Drinks is considering the purchase of a plum juicer - the PJXS. There is no planned Increase in production.
Casplan Sea Drinks is considering the purchase of a plum juicer - the PJXS. There is no planned Increase in production. The PJX5 will reduce costs by squeezing more juice from each plum and doing so in a more efficient manner. Mr. Bensen gave Derek the following information. What is the NPV of the PJX5? a. The PJX5 will cost $1.69 million fully installed and has a 10 year life. It will be depreciated to a book value of $255,475.00 and sold for that amount in year 10. b. The Engineering Department spent $12,947.00 researching the various Juicers. c. Portions of the plant floor have been redesigned to accommodate the juicer at a cost of $22,076.00. d. The PJX5 will reduce operating costs by $417,420.00 per year. e. CSD's marginal tax rate is 21.00%. f. CSD is 71.00% equity-financed. 9. CSD's 18.00-year, sem annual pay, 5.33% coupon bond sells for $1,050.00. h. CSD's stock currently has a market value of $20.37 and Mr. Bensen believes the market estimates that dividends will grow at 3.21% forever. Next year's dividend is projected to be $1.58. Submit Answer format: Currency: Round to: 2 decimal places
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