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zaharov [31]
3 years ago
13

Identifying cash flows (LO 1) Mighty Vita produces a wide range of herbal supplements sold nationwide through independent distri

butors. In response to an increasing demand for its products, the company is considering the purchase of a new packaging machine to replace the seven-year-old machine currently in use. The new machine will cost $160,000, and installation will require an additional $15,000. The machine has a useful life of 10 years and is expected to have a salvage value of $8,000 at that time. The variable cost to operate the new machine is $10 per carton compared to the current machine's variable cost of $10.10 per carton, and Mighty Vita expects to pack 250,000 cartons each year. If the new machine is purchased, Mighty Vita will avoid a required $11,050 overhaul of the current machine in three years. The current machine has a market value of $12,850. Identify the amount and timing of all cash flows related to the acquisition of the new packaging machine. Cash Flow Timing Amount Purchase price $ Installation Salvage of old equipment Salvage of new equipment Variable cost savings Avoided overhaul
Business
1 answer:
natta225 [31]3 years ago
7 0

Answer:

Mighty Vita

Cashflow and timing

Year 0. Machine cost = -$160,000 (outflow)

Year 0. Set up costs = -$15,000 (outflow)

Year 0. Salvage of Old equipment = $12,850 (inflow)

Year 3. Savings on Overhaul of old machine = $11,050 (inflow)

Year 1 - 10. Variable Costs Savings = ($0.10 x 250,000) = $25,000 (inflow)

Year 10. Salvage value = $8,000 (inflow)

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Each of the four types of checking accounts listed in the table above offers free ATM
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Yes it will
gib branliest
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2 years ago
Human capital refers to:
Digiron [165]

Answer:

C. the skills and knowledge that enable a worker to be productive.

Explanation:

'Human Capital' is the stock of knowledge & skills embodied in people, enabling them to perform labour of economic value. It is considered as 'capital' because skills & knowledge development to become more productive yields better income & standard of living.

Human Capital formation i.e knowledge, skills & productivity enhancement has two crucial components : Education and Health.

Options A, B, D are inapt because : Human Capital is not 'physical capital', 'financial wealth', 'machinery' ; but is rather immaterial knowledge & skill set in people.

4 0
2 years ago
Aldo Redondo drives his own car on company business. His employer reimburses him for such travel at the rate of 36 cents per mil
Tom [10]

<u>Solution and Explanation:</u>

<u>Step 1 </u>

Consider the given information:

Reimbursement = 36 cents per mile

Fixed cost per year = $2,052 minus 205200 cents

Direct variable cost = 14.4 cents per mile

<u>Step 2 </u>

At the break-even point, total cost becomes equal to the total revenue.

Suppose it takes Q miles for ARto reach break-even.

Step1: Calculate the total cost of AR when the car cover Q miles, as shown below:

Total Cost = Fixed cost + Variable Cost

                 = 205,200 + 14.4 Q

<u>Step 2</u> Calculate the total revenue (reimbursement) of AR when the car covers Q miles, as shown below:

Total Revenue = Reimbursement multiply with Total miles

                       = 36Q

<u>Step 3:</u> Calculate the break-even miles for the car, as shown below:

At break-even,  Total cost = Total revenue

205,200 plus 14.4Q = 36Q

      36Q minus 14.4Q = 205,200

            21.6Q = 205,200

   Q = 205,200 divide by 21.6

    Q = 9,500 miles

Hence, AR should drive 9,500 miles to break-even.        

5 0
2 years ago
Assume that Horicon Corp acquired 25% of the common stock of Sheboygan Corp. on January 1 for $300,000. During the year Sheboyga
ella [17]

Answer:

The balance in the investment account on December 31 will be $325,000

Explanation:

The equity method is computed by applying an equation which is shown below:

= Opening balance of common stock + rate of common stock × (Net income - dividend paid)

= $300,000 + 25% × ($160,000 - $60,000)

= $300,000 + 25% × $100,000

= $300,000 + $25,000

= $325,000

Since, only 25% of common stock is acquired so, only 25% is to be considered in the computation part. And all other balances are also considered together.

Hence, the balance in the investment account on December 31 will be $325,000

8 0
3 years ago
Explain the relationship between the factors of production and how that creates a
Degger [83]

Answer:

Natural resources (land)

Labor  (human capital)

Capital (machinery, factories, equipment)

Entrepreneurship

Explanation:

nature is the first key of success like having a land to start up

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capital is needed just like food, no money no business

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7 0
3 years ago
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