1answer.
Ask question
Login Signup
Ask question
All categories
  • English
  • Mathematics
  • Social Studies
  • Business
  • History
  • Health
  • Geography
  • Biology
  • Physics
  • Chemistry
  • Computers and Technology
  • Arts
  • World Languages
  • Spanish
  • French
  • German
  • Advanced Placement (AP)
  • SAT
  • Medicine
  • Law
  • Engineering
katrin [286]
3 years ago
15

Granfield Company has a piece of manufacturing equipment with a book value of $35,500 and a remaining useful life of four years.

At the end of the four years the equipment will have a zero salvage value. The market value of the equipment is currently $21,100. Granfield can purchase a new machine for $111,000 and receive $21,100 in return for trading in its old machine. The new machine will reduce variable manufacturing costs by $18,100 per year over the four-year life of the new machine. The total increase or decrease in net income by replacing the current machine with the new machine (ignoring the time value of money) is:a. $17,500 increaseb. $72,400 decreasec. $14,400 decreased. $48,850 increasee. $17,500 decrease
Business
1 answer:
Doss [256]3 years ago
7 0

Answer: Option (e) is correct.

Explanation:

Given that,

Book value of manufacturing equipment = $35,500

Current market value of equipment = $21,100

Cost of new machine = $111,000

cash received from trading old machine = $21,100

Variable manufacturing costs of new machine reduce by $18,100 per year over the four-year =

Total increase/decrease in net income = Cost of new machine + cash received from trading old machine + Reduction in Variable manufacturing costs

                                                =  ($111,000) + $21,100 + $18,100 × 4

                                                = ($17,500)

Note: Bracket represents the negative values.

∴ The total decrease in net income by replacing the current machine with the new machine is $17,500.

You might be interested in
The person who receives financial protection from a life insurance plan is called a what?
Marina CMI [18]
The person who receives financial protection from a life insurance plan is called a Beneficiary

3 0
3 years ago
Companies like my​ gym, which seek to do business in new markets for manufacturing​ and/or marketing​ purposes, have many potent
jeka94

They have many potential <u>Entry Modes</u> at their disposal.

<h3>What is Entry Mode?</h3>

Foreign market entrance modes in international trade are the methods through which a corporation can expand its services into a non-domestic market.

Market entrance options are classified into two types: equity and non-equity. Export and commercial agreements are examples of non-equity mechanisms. Joint ventures and totally owned subsidiaries are examples of equity models. Different entrance mechanisms differ in three key ways:

  • The level of danger they pose.
  • Control and dedication to the resources required.
  • The promised return on investment

Therefore, Companies like my​ gym, which seek to do business in new markets for manufacturing​ and/or marketing​ purposes, have many potential​ <u>Entry Modes</u> at their disposal.

For more information on Entry Modes, refer to the given link:

brainly.com/question/17232113

#SPJ4

4 0
1 year ago
What is a renewal date
Allushta [10]
Full Definition<span> of </span>renewal<span>.
 1 : the act or process of </span>renewing<span> : repetition.
 2 : the quality or state of being </span>renewed<span>.
Hope that this helps you! =)</span>
8 0
2 years ago
Read 2 more answers
Both the Government and the contractor have the option of going to court to resolve disputes between them. True False
julia-pushkina [17]

Answer:

True

Explanation:

A contract can be defined as an agreement between two or more parties (group of people) which gives rise to a mutual legal obligation or enforceable by law.

A contractor can be defined as a self employed individual or business entity that provides services or work for another for an agreed fee.

This ultimately implies that, a contractor is a non-employee of the organization he provides services or work for. Some examples of a contractor are consultants, engineers, lawyers, accountants, auditors, doctors etc.

Basically, the government of a country usually employs the services of contractors for the execution of public projects and works.

Hence, both the Government and the contractor have the option of going to court to resolve disputes between them.

7 0
3 years ago
Southern Foods just paid an annual dividend of $1.10 a share. Management estimates the dividend will increase by 10 percent a ye
Gnoma [55]

Answer:

$16.21

Explanation:

Worth of the stock is the present value of all the cash flows associated with the stock. Dividend is the only cash flow that a stock holder receives against its investment in the stocks. We need to calculate the present values of all the dividend payments.

Dividend Payment               $1.10    

Growth rate first 3 years 10%  

Growth rate first 4 years 3.2%  

Required rate of return          12%  

                                                 Dividend   Discount Factor    PV Factor

First year Dividend                     $1.21      0.892857143         $1.08  

Second year Dividend               $1.33     0.797193878          $1.06  

Third year Dividend                   $1.46     0.711780248          $1.04  

Fourth year Dividend                 $1.61      0.635518078        $1.02  

Stock value after fourth year = $18.89    0.635518078       <u>$12.00 </u>

Stock Value                                                                            <u>$16.21 </u>

5 0
3 years ago
Other questions:
  • Which type of account will typically have the highest interest rate?
    6·1 answer
  • Future value of an annuity: Carlos Menendez is planning to invest $3,500 every year for the next six years in an investment payi
    11·1 answer
  • What is something that parents can do to improve their child’s academic self-esteem?
    14·2 answers
  • Courtney recently ordered a few books online. However, she received the wrong order. She was completely dissatisfied and returne
    5·2 answers
  • According to the U.S. Department of Labor Statistics, _____ is the industry earning the highest average annual wage in 2009.
    9·2 answers
  • The concept "bureaucracy" refers to
    13·1 answer
  • If the management decision problem is: "should a new product be introduced?" what is the most appropriate marketing research pro
    5·1 answer
  • g Suppose the own price elasticity of demand for good X is -3, its income elasticity is 2, and the cross price elasticity of dem
    5·1 answer
  • What can you create best in PowerPoint Online?
    11·1 answer
  • A manufacturer sells his product at $23 per unit, selling all he produces. His fixed cost is $18,000 and his variable cost per u
    12·1 answer
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!