Question: PLEASE GIVE ME THE ANSWER IN FORMAT THAT YOU SEE HERE IN QUESTION. I WROTE 123456 IN NUMERIC BOXES. THANK YOU! Wendells Donut Shoppe is
PLEASE GIVE ME THE ANSWER IN FORMAT THAT YOU SEE HERE IN QUESTION. I WROTE 123456 IN NUMERIC BOXES. THANK YOU!
| Wendells Donut Shoppe is investigating the purchase of a new $34,500 donut-making machine. The new machine would permit the company to reduce the amount of part-time help needed, at a cost savings of $5,600 per year. In addition, the new machine would allow the company to produce one new style of donut, resulting in the sale of 1,600 dozen more donuts each year. The company realizes a contribution margin of $2.00 per dozen donuts sold. The new machine would have a six-year useful life. |
| Click here to view Exhibit 13B-1 and Exhibit 13B-2, to determine the appropriate discount factor(s) using tables. |
| Required: | |
| 1. | What would be the total annual cash inflows associated with the new machine for capital budgeting purposes? |

| 2 Find the internal rate of return promised by the new machine to the nearest whole percent. PLEASE Choose Numerator: Annual Cash Inflow or Annual cash Outlfow or Investment Required PLEASE Choose Denominator: Annual Cash Inflow or Annual cash Outlfow or Investment Required
|
Annual savings in part-time help Added contribution margin from expanded sales Annual cash inflows 123,456 123,456 246,912
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