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zlopas [31]
3 years ago
6

Five years ago, Miller Manufacturing spent $150,000 on a new piece of industrial machinery. Six months ago, the firm spent $32,0

00 on upgrades to the machinery. Currently, Miller is considering whether to replace the existing machine with newer machinery with a purchase price of $180,000. When conducting the incremental analysis related to this decision, Miller should consider all of the following factors EXCEPTA) any salvage value associated with the new machinery.B) the cost of the upgrades to the old machinery. C) any salvage value associated with the old machinery. D) any differences in the variable costs associated with each piece of machinery.
Business
1 answer:
natta225 [31]3 years ago
7 0

Answer:

The answer is B

Explanation:

In Miller's decision-making process, he needs to recognize the costs and benefits that he will get from replacing the existing the current machinery with the new one and ignore all the cost that had happened (sunk cost) because has already incurred even if Miller chooses to replace or not to replace the current machine. In this case, it is the cost incurred to upgrade the current machine.

For option A, salvage value of the new machinery should be considered as it helps Miller estimates how much money he is going to recover after the machinery's useful life.

For C, salvage value of the current machinery should be considered as it helps Miller estimates how much he will get from selling this current machine as he disposes them to replace with the new one.

For D, Miller will need to know those the replacement result in any cost saving or cost increasing in the future which is part of the benefit or the cost of replacement.

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1 year ago
Andrea's opportunity cost rate is 12 percent compounded annually. how much must he deposit in an account today if he wants to re
BabaBlast [244]

Answer:

$9583.89

Explanation:

value of each payment (P): $2,100

interest rate per period (r): 12/100 = 0.12

number or periods (n): 7

present value of annuity (PV): ??

using the annuity formula: PV = P * \frac{1 - (1 + r )^{-n} }{r}

PV  =  $9583.89

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3 years ago
2. Three years ago, Shawheen deposited $5,000 in a savings account. Today, the account is worth
AnnyKZ [126]

The amount of money Shawheen deposited in his savings account increased in value because of the interest rate his account earns.

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The value of the interest rate can be determined using this formula: interest earned / (time x amount deposited)

Interest earned = $$5,306.04 - $5,000 = $306.04

Interest rate = $306.04 / (3 x $5000) = 2.04%

Inflation is the persistent rise in the general price levels. Inflation reduces the purchasing power of money.

To learn more about inflation, please check: brainly.com/question/18072639

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