On this basis , find the replacement strategy.

Assignment Help Finance Basics
Reference no: EM131435804

Question: A widget manufacturer operates two machines , each of which has a capacity of 1000 units a year. They have an indefinite life and zero salvage value. The operating cost is $2 per widget. Widget is a seasonal business. During half of the year they run at full capacity and in the balance half at 50% capacity. The discount rate is 10%. The company is considering, whether to replace these machines with newer equipments. The new machine has similar capacity and two would be needed to meet the peak demand. Each new machine cost $6000 and lasts indefinitely. Operating expenses are only $1 per unit. On this basis , find the replacement strategy.

Reference no: EM131435804

Questions Cloud

How high above the base of the cliff will the arrow rise : You are standing on the top of a tall cliff and shoot an arrow from a height of 30.0 m at 25.0 m/s and an initial angle of 32.0° above the horizontal. How high above the base of the cliff will the arrow rise? Assume a level landscape.
What will be the optimal time to sell the machine : A machine costs $2000 and gives cash inflow of $25000 a year for three years. If the firm can sell the machine at Year-1,2,3 , what will be the optimal time to sell the machine. The maintenance cost and the salvage value are as follows: Year Maint..
Prepare a performance report using spreadsheet software : Prepare a performance report using spreadsheet software, such as Excel. Hint: Read the Weekly Briefing and watch the Performance Report video on this topic.
Frictionless horizontal surface as shown : A small block of mass m1 is released from rest at the top of a curve-shaped, frictionless wedge which sits on a frictionless horizontal surface as shown. The height of the wedge is h = 5m.
On this basis , find the replacement strategy. : A widget manufacturer operates two machines , each of which has a capacity of 1000 units a year. They have an indefinite life and zero salvage value. The operating cost is $2 per widget. Widget is a seasonal business.
Calculate a benefit-to-cost ratio : QSO 645 Project Selection Journal Guidelines. You are a project manager for a local company that is considering installing a new content management system. Your boss has asked you to do a net present value (NPV) analysis, calculate a benefit-to-cos..
Employee representation across demographic categories : Examine the percentages of employee representation across demographic categories for Tanglewood and the available labor market for Table 1.3. Are there any particular classes or jobs where the representation within Tanglewood appears to be out of lin..
Explain and define four of seven general moral principles : Describe and define four of the seven general moral principles, and explain how the moral principles you chose, could improve an organizations' ethical climate. Please provide examples to support your statements.
Problem related to one off decision : A corporation is considering replacing an existing machine with a new machine. The new machine costs $60,000 plus installation costs of $2,000. It will generate revenues of $155,000 annually and cash expenses annually of $100,000.

Reviews

Write a Review

 

Finance Basics Questions & Answers

  Question on time value of money

Why do we say money has time value? Why is it significant for business managers to be familiar with the time value of money concepts? Illustrate out the term Present Value.

  How is learning defined and/or described by each of theories

How is learning defined and/or described by each of these theories? How are each of the theories similar? How do they differ?

  Discuss the common characteristics of an organization

What is an organization? Discuss the common characteristics of an organization. Why do we study management?

  To prevent gasoline prices from having devastating effects

to prevent gasoline prices from having devastating effects on the economy it has been proposed that all gasoline prices

  Suppose you find a 65 percent coupon bond with a current

suppose you find a 6.5 percent coupon bond with a current market price of 832. the yield to maturity is 16.28 percent

  What is the amount of the net savings from subscribing

The initial charge for this service is €540, with an additional charge of €6 per individual report. What is the amount of the net savings from subscribing to the credit agency?

  Statements concerning defined-contribution plans

Find the correct statements concerning defined-contribution plans.

  Why is marginal analysis important in economics

Why is marginal analysis important in economics? How do the tutorials Basics of Marginal Analysis and Understanding and Applying Marginal Analysis at the end of this week's lecture reinforce the concepts of marginal analysis? How can any firm find..

  What price would an investor be expected to pay

A stock is expected to pay $2.80 per share every yr indefinately and the equity cost of capital for the company is 11%. what price would an investor be expected to pay per share next year?

  Discuss the impact of major accounting

Discuss the impact of major accounting/financial scandals on investors

  Prepare the entry that reflects the acquisition

Why would Conglomerate pay more than the per-share market value for a share of Camden common stock?

  What current assets are included in the balance sheet

Find the balance sheet and notes to the financial statements in the most recent FORM 10-K for your publicly traded company. The Form 10-K can be located by going to the home page of the Securities and Exchange Commission.

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd