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valkas [14]
3 years ago
5

Kinder Enterprises relies heavily on a copier machine to process its paperwork. Recently the copy clerk has not been able to pro

cess all the necessary copies within the regular work week. Management is considering updating the copier machine with a faster model. Current Copier New Model Original purchase cost $10,000 $20,000 Accumulated depreciation 8,000 — Estimated operating costs (annual) 7,000 2,600 Useful life 5 years 5 years If sold now, the current copier would have a salvage value of $1,000. If operated for the remainder of its useful life, the current machine would have zero salvage value. The new machine is expected to have zero salvage value after five years.

Business
1 answer:
Elza [17]3 years ago
6 0

Answer:

Operating costs = $7,000 x 5 years = $35,000

Operating costs = $2,600 x 5 years = $13,000

Explanation:

Operating costs = $7,000 x 5 years = $35,000

Operating costs = $2,600 x 5 years = $13,000

The current copier should be replaced. The incremental analysis shows that net income for the five-year period will be $3,000 higher by replacing the current copier.

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firm has 2,000,000 shares of common stock outstanding with a market price of $2 per share. It has 2,000 bonds outstanding, each
Yuki888 [10]

Answer:

A Firm

The firm's WACC is:

= 12.16%

Explanation:

a) Data and Calculations:

                                              Common               Bonds

                                                  Stock

Outstanding shares/bonds  2,000,000              2,000

Market price per unit                $2                     $1,200

Total market value             $4,000,000   $2,400,000

Total value of debt and equity = $6,400,000

Weight                                      62.5%                37.5% ($2,400/$6,400*100)

Cost of bonds (coupon rate) = 10%

Tax rate = 34%

Firm's beta = 1.5

Risk-free rate = 5%

Market risk premium = 7%

After-tax cost of bonds = 6.6% (1 - 0.34) * 10%

Cost of common stock =

Risk Free Rate + Beta x (Market Return - Risk Free Rate)

= 5% + 1.5 x (7%)

= 5% + 10.5%

= 15.5%

WACC = 15.5% * 62.5% + 6.6% * 37.5%

= 0.096875 + 0.02475

= 0.1216

= 12.16%

7 0
2 years ago
At January 1, 2019, Deer Corp. has beginning inventory of 2,000 surfboards. Deer estimates it will sell 10,000 units during the
coldgirl [10]

Answer:

The correct answer is $1,881,600

Explanation:

According to the scenario, the computation of the given data are as follows:

Unit sells = 10,000 units

Growth rate = 12%

Selling price = $150 per unit

Costing = $100 per unit

So, we can calculate the budget sales revenue by using following formula:

Budget sales unit for quarter 3 = (10,000 × 112%) × 112% = 12,544

So, budget sales amount for quarter 3 = 12,544 × $150

= $1,881,600

4 0
3 years ago
Question 9 of 10<br> 2 Points<br> A personal skill is ____
ss7ja [257]

Answer:

A personal skill is something that you have learned or aquired over your time of working or something you're specifically good at.

Explanation:

Hope this helps :))

3 0
2 years ago
Any person who knowingly submits false claims to the government is liable for five times the government's damages caused by the
Alina [70]
The statement above is FALSE.
The correct sentence is this: Any person who knowingly submit false claims to the government is liable for THREE TIMES the government damages caused by the violator plus a penalty. This means that the violator will three fold of the damages he causes not five folds.
7 0
2 years ago
InstaTrack is a newly emerging athletic shoe manufacturing company. After extensive market research, InstaTrack divides its mark
Vesna [10]

Answer:

d. segmentation

Explanation:

Segmentation is when a firm divides its customers or potential customers into groups based on certain traits.

Types of segmentation includes:

Demographic segmentation

Psychographic segmentation

Behavioral segmentation

Geographic segmentation

3 0
3 years ago
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