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Daniel [21]
3 years ago
13

A company with $500,000 in operating assets is considering the purchase of a machine that costs $60,000 and which is expected to

reduce operating costs by $15,000 each year. These reductions in cost occur evenly throughout the year. The payback period for this machine in years is closest to (Ignore income taxes.):
Business
1 answer:
Masteriza [31]3 years ago
4 0

Answer:

Payback = 4 years

Explanation:

If a project has equal annual cash-flows, the payback period can be  calculated using the formula:

Payback=\frac{CostOfMachine}{AnnualCashflows}

The reduction in operating costs resulting from the purchase of the machine is treated as cash inflows for capital investment decisions. As such, annual cash inflows to be used in the formula above =$15,000 each year.

Payback=\frac{60,000}{15,000}=4years

It will take the company 4 years to recover the initial investment.

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Activity-based costing uses one plantwide pool and numerous cost drivers departmental pools and a single cost driver. numerous c
kipiarov [429]

Answer:

numerous cost pools and numerous cost drivers

Explanation:

Costing is the measurement of the cost of production of goods and services by assessing the fixed costs and variable costs associated with each step of production.

In Financial accounting, one of the most widely used activity-based costing technique is the time-driven activity-based costing.

Time-driven activity-based costing (TDABC) avails business owners the opportunity of reporting their costs on an ongoing basis (real time) which give details about the various cost of doing business, as well as the time spent on them respectively.

Cost pool is simply the amount of money spent by a firm on a particular activity.

Generally, an activity-based costing uses numerous cost pools such as manufacturing cost or customer services and numerous cost drivers such as direct labor hours worked, number of changes used in engineering department, etc.

6 0
3 years ago
A mortgage requires you to pay $70,000 at the end of each of the next eight years. The interest rate is 8%.
bazaltina [42]

Answer:

PV $402,264.7261

balance of the mortage

1-y from now   $364,445.9041

2-y from now   $323,601.5765

3-y from now  $279,489.7026

4-y from now  $231,848.8788

5-y from now $180,396.7891

6-y from now   $124,828.5322

7-y from now   $64,814.8148

Explanation:

We sovle for the PV of the annuity of 70,00 during 8 years discounted at 8%

C \times \frac{1-(1+r)^{-time} }{rate} = PV\\

C 70,000.00

time 8

rate 0.08

70000 \times \frac{1-(1+0.08)^{-8} }{0.08} = PV\\

PV $402,264.7261

To know the value of the outstanding dbet we can repeat this formula changing the values for time

t = 7   $364,445.9041

t = 6   $323,601.5765

t = 5   $279,489.7026

t = 4   $231,848.8788

t = 3   $180,396.7891

t = 2   $124,828.5322

t = 1   $64,814.8148

8 0
3 years ago
There are 5 applicants for a job, all of whom have different qualifications. the employer is in a hurry, and does not interview
Alenkinab [10]
To choose the two best, we have a target of two candidates, A & B
The first one chosen is either A or B, with a propability of 2/5.
The second one is the only interested candidate out of 4, so 1/4.
So probability of choosing the best two is 2/5*1/4=1/10.

Alternatively, use the combination formula, 
P(AB in any order) = 5!/(2!3!)=120/(2*6)=1/10
or in general,
n choose r = nCr = n!/(r!(n-r)!)
5 0
3 years ago
Which one of the following is not an institutional requirement for markets to operate smoothly? Group of answer choices A equal
givi [52]

Answer:

A equal balance of economic power among buyers and sellers.

Explanation:

For a market to operate smoothly the operational requirement required include:

1. Social Institutions of trust

2. Money as a medium of exchange

3. Individualist institutions related to private and decision making.

When a market is operating smoothly it means that the financial safety net and settlement system works efficiently. Traders can operate seamlessly without delays in payments.

The option that is not a requirement for smooth operation of the market is - equal balance of economic power among buyers and sellers.

7 0
3 years ago
Mike Hansen has adjusted gross income of $28,000. During the year, Mike decided he needed a larger home. He purchased a home on
masya89 [10]

Answer: The whole of $7,500 moving expenses

Explanation:Mike Hansen is entitled to the deduction of $7,500 moving expenses  from his adjusted gross income.  

The IRS now allows employees to deduct any moving expenses incurred by them to be deducted from their adjusted gross income before taxation.

4 0
3 years ago
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