The management of Opry Company, a wholesale distributor of suntan - 17417

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yousafbhutta

yousafbhutta

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Price: $3.00
  • From: Business,
  • Posted on: Mon 27 May, 2013
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Request Description

 

The management of Opry Company, a wholesale distributor of suntan products, is considering the purchase of a $25,000 machine that would reduce operating costs in its warehouse by $4,000 per year. At the end of the machine’s 10-year useful life, it will have no scrap value. The company’s required rate of return is 12%. (Ignore income taxes.)

 

Click here to view Exhibit 13B-2, to determine the appropriate discount factor(s) using table.

 

    

 

Required:

1.

Determine the net present value of the investment in the machine. (Negative amount should be indicated by a minus sign. Round discount factor(s) to 3 decimal places, intermediate and final answers to the nearest dollar amount. Omit the "$" sign in your response.)

 

    

 

  Net present value

 

 

    

 

2.

What is the difference between the total, undiscounted cash inflows and cash outflows over the entire life of the machine? (Omit the "$" sign in your response.)

 

    

 

  Net cash flow

 

 

 

Solution Description

Please give me your A++

Attachments
Opry Company.docx
Opry Company.do...