User Account

All Pages

Calculate the net present value for the new computer system

Assignment Help Managerial Accounting
Reference no: EM132533847

C management estimates that if it invests $250,000 in a new computer system, it can save $65,000 in annual cash operating costs. The system has an expected useful life of eight years and disposal value for old system $28,500. The required rate of return is 8%. Income tax issues at a 40% rate and assume all cash flows occur at year-end except for initial investment amounts. Additional working capital, $30,000.

Required:

Calculate the following for the new computer system:

Question a. net present value

Question b. payback period

Question c. Accrual accounting rate of return based on net initial investment

Question d. Accrual accounting rate of return based on average investment

Question e. What other factors should Home Value consider in deciding whether to purchase the new computer system?

Reference no: EM132533847

Questions Cloud

Purpose of securing corporate knowledge specific : Outline the process that may be taken for the purpose of securing corporate knowledge specific to the B-Tec technology company.
Why should we have a chronos and kairos view of history : Why should we have a Chronos and Kairos view of history and time and events? What would our understanding of our past look like if we only used one or the other
Invests exclusively in treasury securities : What yield would make you indifferent between this fund and a money market fund that invests exclusively in treasury securities?
Determine how you would create a curriculum in art : Many children with special needs spend at least part of the school day in special education classrooms, where they receive special instruction, sometimes quite.
Calculate the net present value for the new computer system : What other factors should Home Value consider in deciding whether to purchase the new computer system?Calculate the net present value
Describes increase in us money supply : Your book describes the increase in the U.S. money supply as being analogous to giving people more money.
What type of compensation is a greater motivator : What type of compensation is a greater motivator for you, and why?
What are the budgeted fixed costs for the year : What are the budgeted fixed costs for the year? The relationship pertains to a year's budgeted activity regarding this service
What do diverse leaders bring to an organization : What do diverse leaders bring to an organization? Discuss the benefits and costs of lived experiences associated with sexism and racism faced by women.

Reviews

Write a Review

Managerial Accounting Questions & Answers

  Net cash flow from operating activities for the year

What was the net cash flow from operating activities for the year?

  Why is the cost allocation method used

Why is the cost allocation method used by an organization an important part of its cost accounting system?

  Gaap and income tax accounting

Describe how they are similar and why there are differences. Also, include specific examples of how and when to apply the principles of both types of accounting.

  Calculate break even sales in units

Given: Selling price per unit, $20; total fixed expenses, $5,000; variable expenses per unit, $15. Find break-even sales in units.

  Describe the cost flow in job order costing system

The three product cost elements?direct materials, direct labor, and overhead? Flow through job order costing system in structured, orderly fashion. Specific accounts and subsidiary ledgers are employed to verify and record cost information.

  Produce a profit statement for each division detailing sales

Produce a profit statement for each division detailing sales and costs, separating external sales and inter-divisional transfers. Provide a brief commentary

  Compute the dealership sales price variance and sales

Compute the dealership's sales price variance and sales volume variance for the first six months of 2013.

  What break even point in sale for larger bottle of glue

If Stuckie's can sell the larger bottles of glue for $10 each, what is the break-even point in sales dollars for the larger bottles of glue?

  What the labor volume variance is

Firm P produced 45,000 cellphones using 9,000 hours of labor in 2004; total labor costs were $54,000. What the labor volume variance is

  Provide at least one aspect of the recognition

Provide at least one aspect of the recognition, measurement or disclosure criteria from the standards needs to be presented.

  Find what would be the amount of loss per unit

Find What would be the amount of loss per unit. What is the amount of loss (profit) per unit at the $671.88 selling price per unit for units sold to SC?

  Prepare quarterly production budgets

Sales in the first quarter of 2015 are expected to be 25% higher than sales in the same quarter in 2014 and prepare quarterly production budgets for each quarter and in total for 2014.

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!

Submit Assignment

Academics

Major Subjects

Majors

Get In Touch

whatsapp: +1-415-670-9521

Phone: +1-415-670-9521

Email: [email protected]

TERMS & POLICIES

HELP & SUPPORT

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