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melomori [17]
3 years ago
12

Baird Bros. Construction is considering the purchase of a machine at a cost of $125,000. The machine is expected to generate cas

h flows of $20,000 per year for 10 years and can be sold at the end of 10 years for $10,000. Interest is at 10%. Assume the machine purchase would be paid for on the first day of year one, but that all other cash flows occur at the end of the year. Ignore income tax considerations.
What is the net present value of the cash flows?
Business
1 answer:
andre [41]3 years ago
4 0

Answer:

$1,747

Explanation:

Given:

Generate Cash flows = $20,000 per year

Salvage value = $10,000

Interest = 10% = 0.10

Computation:

Net present value = PV of cash inflows - PV of cash outflow

= [($20,000 X 6.1446) + ($10,000 X 0.3855)] - $125,000

= [$122,892 + 3855] - $125,000

= $1,747

PV factor (for salvage value)

(1+r)^{-n}\\(1+0.10)^{-10}\\0.3855

Inflow PV factor = 6.1446

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If you were christina, how would you design a process control plan to ensure that these requirements were met?
Anuta_ua [19.1K]

With the use of the seven standards from the hazard analysis and critical control points (HACCP), Christina must map the manner with a waft chart to discover all possible control points.

Thru the statistics within the flowchart, she wishes to identify vital manipulate points so as to identify the factors in that capacity dangers can be diagnosed and controlled or eliminated. She wishes to set up crucial limits for each of the identified manipulated points in an effort to perceive the requirements or operating variety wherein the food can be thoroughly processed. There will be methods mounted to determine whilst the cooking temperatures have to be monitored.

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8 0
1 year ago
Keynes believed that wages and prices were sticky. Therefore, a rightward shift of the aggregate demand curve would cause a(n)
Anon25 [30]
Increase aggregate demand. Keynes believed that wages and prices were sticky. Therefore, a rightward shift of the aggregate demand curve would cause a(n).
7 0
3 years ago
When there is an expansionary gap, inflation will ______, in response to which the Federal Reserve will ____ real interest rates
dalvyx [7]

Answer: increase; raise; decline

Explanation:

An expansionary gap occurs in an economy when the potential output in the economy is less than the actual output.

It should be noted that when there is an expansionary gap, this will lead to a rise in inflation. Since inflation has risen, the government will also increase the real interest rates which will in turn, lead to the reduction in output.

7 0
3 years ago
Over the first four years of the company's life, the company earned the following net income (loss): S $3,000; $6,000, and ($2,0
Klio2033 [76]

Answer:

The answer is D.

Explanation:

Total earnings in 4 years

= 6000 + 3000 + 6000 - 2000

= $13,000

Ending retained earnings after 4 years

= $10,000

Total amount paid out as dividend in 4 years

= $13,000 - 10,000

= $3,000

Average amount of dividends paid per year

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= $750

5 0
3 years ago
A sports game company with current sales of $400,000 does not expect any growth in sales for the next two years. The company, ho
Ber [7]

Answer:

Answer is B

Explanation:

Cash flow = Net Income + Adjustment for Non-Cash expenses

So we must first calculate the Net Income for the second year using the Profit and Loss Statement format:

Year 2

Revenue                  $400,000

Less Expenses       ($220,500)

Less Depreciation  ($ 20,000)

Profit before Tax     $159,500

Less Tax                  ($54,230)            {34% of Profit before Tax}

Net Income              $105,270

Add Depreciation    $20,000          

Cashflow                  $125, 270

{Remember Depreciation is a non cash expense, so we must add it to the Net income to arrive at the cash flow}

(Remember the company expects no change in revenue)

5 0
3 years ago
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