14 May CALCULATE THE NET PRESENT VALUE AND PROFITABILITY INDEX OF EACH MACHINE.
BAK Corp. is considering purchasing one of two new diagnostic machines. Either machine would make it possible for the company to bid on jobs that it currently isn’t equipped to do. Estimates regarding each machine are provided below.
| Machine A | Machine B | |||
| Original cost | $77,920 | $185,900 | ||
| Estimated life | 8 years | 8 years | ||
| Salvage value | 0 | 0 | ||
| Estimated annual cash inflows | $20,070 | $39,910 | ||
| Estimated annual cash outflows | $4,910 | $9,820 |
Click here to view the factor table.
(For calculation purposes, use 5 decimal places as displayed in the factor table provided.)
Calculate the net present value and profitability index of each machine. Assume a 9% discount rate.(If the net present value is negative, use either a negative sign preceding the number eg -45 or parentheses eg (45). Round answer for present value to 0 decimal places, e.g. 125 and profitability index to 2 decimal places, e.g. 10.50.)
| Machine A | Machine B | |
| Net present value | ||
| Profitability index |
Which machine should be purchased?
Machine BMachine A
should be purchased.
Our website has a team of professional writers who can help you write any of your homework. They will write your papers from scratch. We also have a team of editors just to make sure all papers are of HIGH QUALITY & PLAGIARISM FREE. To make an Order you only need to click Ask A Question and we will direct you to our Order Page at WriteDemy. Then fill Our Order Form with all your assignment instructions. Select your deadline and pay for your paper. You will get it few hours before your set deadline.
Fill in all the assignment paper details that are required in the order form with the standard information being the page count, deadline, academic level and type of paper. It is advisable to have this information at hand so that you can quickly fill in the necessary information needed in the form for the essay writer to be immediately assigned to your writing project. Make payment for the custom essay order to enable us to assign a suitable writer to your order. Payments are made through Paypal on a secured billing page. Finally, sit back and relax.
About Writedemy
We are a professional paper writing website. If you have searched a question and bumped into our website just know you are in the right place to get help in your coursework. We offer HIGH QUALITY & PLAGIARISM FREE Papers.
How It Works
To make an Order you only need to click on “Order Now” and we will direct you to our Order Page. Fill Our Order Form with all your assignment instructions. Select your deadline and pay for your paper. You will get it few hours before your set deadline.
Are there Discounts?
All new clients are eligible for 20% off in their first Order. Our payment method is safe and secure.