Question: please show work and fill out table 7) ( 35 points) Andes Inc. is considering the purchase of a new automated pallet stacking device to
7) ( 35 points) Andes Inc. is considering the purchase of a new automated pallet stacking device to decrease labor costs in its distribution center. For this device, the following data apply: Purchase price =$648,000 \{ $360,000 from own funds (equity) and $288,000 from a loan\} Equipment Life: 4 years Estimated salvage: $129,600 EOY 1 Expected O\&M Costs Depreciation: MACRS-GDS 3-year property Effective tax rate: 35% Estimated Labor Savings $259,200 $288,000 $316,800 $345,600 Conditions on loan: $288,000 borrowed at a nominal rate of 6% per year compounded annually. The loan is to be repaid over 3 years with equal annual payments. a) (10 points) Loan calculations - principal and interest payments. (Round off values to the nearest dollar) b) (25 points) Find the ATCF for each year of this investment (Round off values to the nearest dollar)
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