What the net present value to be provided

Assignment Help Accounting Basics
Reference no: EM133055891

Question - NUBD Co. plans to replace one of its machines with a new efficient one. The old machine has a net book value of P120,000 with remaining economic life of 4 years. This old machine can be sold for P80,000. If the new machine were acquired, the cash operating expenses will be reduced from P240,000 to P160,000 for each of the four years, the expected economic life of the new machine. The new machine will cost NUBD a cash payment to the dealer of P300,000. The company is subject to 32% tax and for this kind of investment, a marginal cost of capital of 9%. Use 5 decimal places for the PV factors. What the net present value to be provided by the replacement of the old machine?

Reference no: EM133055891

Questions Cloud

Explain the working capital and net working capital : 1. Dell Computer Corporation (DELL) has long been recognized for its innovative approach to managing its working capital. Describe how Dell pioneered the manage
How many units per year the firm must sell for investment : NUBD Co. is considering a new product that will sell for P100 and has a variable cost of P60. How many units per year the firm must sell for investment
What is the maximum flow model : 1. What is the maximum flow model? Give several examples of problems that can be solved using the maximal-flow model.
Concept in our technology environment : Discuss the value of seeking spiritual wisdom. Why is wisdom a relevant concept in our technology environment?
What the net present value to be provided : Use 5 decimal places for the PV factors. What the net present value to be provided by the replacement of the old machine
What is the current value of the stock : The In-Tech Co. just paid a dividend of $1 per share. Analysts expect s dividend to grow at 25 percent per year for the next three years and then 5 percent per
Calculate the npv of the proposed hotel investment : 1. Calculate the NPV of the proposed hotel investment. Discuss how sensitive is this NPV to future sales volume of the BTT hotel?
Business intelligence in real-world situation : Describe the use of business intelligence (BI) in a real-world situation that you have experienced, or research BI used within a Fortune 1000 organization
Is amazon part of any major index : Is Amazon part of any major index? If yes, please provide details.

Reviews

Write a Review

Accounting Basics Questions & Answers

  How much control does fed have over this longer real rate

Hubbard argues that the Fed can control the Fed funds rate, but the interest rate that is important for the economy is a longer-term real rate of interest.   How much control does the Fed have over this longer real rate?

  Coures:- fundamental accounting principles

Coures:- Fundamental Accounting Principles: - Explain the goals and uses of special journals.

  Accounting problems

Accounting problems,  Draw a detailed timeline incorporating the dividends, calculate    the exact Payback Period  b)   the discounted Payback Period. the IRR,  the NPV, the Profitability Index.

  Write a report on internal controls

Write a report on Internal Controls

  Prepare the bank reconciliation for company

Prepare the bank reconciliation for company.

  Cost-benefit analysis

Create a cost-benefit analysis to evaluate the project

  Theory of interest

Theory of Interest: NPV, IRR, Nominal and Real, Amortization, Sinking Fund, TWRR, DWRR

  Liquidity and profitability

Distinguish between liquidity and profitability.

  What is the expected risk premium on the portfolio

Your Corp, Inc. has a corporate tax rate of 35%. Please calculate their after tax cost of debt expressed as a percentage. Your Corp, Inc. has several outstanding bond issues all of which require semiannual interest payments.

  Simple interest and compound interest

Simple Interest, Compound interest, discount rate, force of interest, AV, PV

  Capm and venture capital

CAPM and Venture Capital

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