Ask Question, Ask an Expert

+1-415-315-9853

info@mywordsolution.com

Ask Basic Finance Expert

problem: Vandalay Industries is considering the purchase of a brand new machine for the manufacture of latex. Machine a costs dollar 2,030,000 & will last for three years. Variable costs are 37% of sales & fixed costs are dollar 124,000 per year. Machine B costs dollar 4,470,000 & will last for five years. Variable costs for this machine are 26% of sales & fixed costs are dollar 86,000 per year. The sales for each machine will be dollar 8,940,000 per year. The required return is 10% & the tax rate is 35%. Both machines will be depreciated on a straight line basis. If the company plans to replace the machine when it wears out on a perpetual basis, the EAC for machine A is dollar ________ & the EAC for machine B is dollar _______. Therefore, you should choose machine__________. (Negative amount should be indicated by a minus sign. [Give your answer to the nearest whole dollar amount]

Basic Finance, Finance

  • Category:- Basic Finance
  • Reference No.:- M917859

Have any Question? 


Related Questions in Basic Finance

1 what is financial leverage why is a one-year measure of

1. What is financial leverage? Why is a one-year measure of return on investment inadequate in determining whether positive or negative financial leverage exists? 2. What is the motivation for a sale-leaseback of the lan ...

1 describe in your own words the techniques that scientists

1. Describe in your own words the techniques that scientists use to help them avoid drawing statistically invalid conclusions. 2. What is a statistically significant result? What is the relationship among statistical sig ...

Make sense of data-as a marriage counselor you have

Make sense of data:- As a marriage counselor, you have gathered the following statistics: a. The average age at which women marry for the fi rst time has increased by 1.5 years in the last decade. b. The average age at w ...

1 how can tax law changes create incentives for investors

1. How can tax law changes create incentives for investors to sell their properties to other investors? 2. How important are taxes in the decision to sell a property? 3. Are tax considerations important in renovation dec ...

Write a ten page essay about investnment the essay can be

Write a ten page essay about investnment. The essay can be about why is it so appealing to learn investment, what are some benefits of learning investment, who are some best investors in the world, what were my favorite ...

1 what are the main advantages and disadvantages to

1) What are the main advantages, and disadvantages, to entering a futures hedge? Explain your answer with reference to a futures contract on wheat. Assume the current price is 400 cents per bushel and the futures price i ...

Grace carter purchased 100 shares of the stock of rock

Grace Carter purchased 100 shares of the stock of Rock Securities one year ago. Last year the price of the stock was $50 per share. In the year, Rock Securities paid a dividend of $2.40 per share. The price of the stock ...

1 what are the total assets and net income available to

1. What are the total assets and net income available to common shareholders for McDonald's Corp. (ticker: MCD:US) at the end of each of the last five fiscal years? Read this information from the annual financial stateme ...

Suppose that you are following the stock of a firm that has

Suppose that you are following the stock of a firm that has been experiencing severe problems. Failure is imminent unless the firm is granted government guaranteed loans. If the firm fails, its stock will, of course, fal ...

Explain why a call option with zero exercise price is

Explain why a call option with zero exercise price is equivalent to the underlying stock, assuming no dividends on the stock during the life of the option? Why might two calls or puts alike in all respects but time to ex ...

  • 4,153,160 Questions Asked
  • 13,132 Experts
  • 2,558,936 Questions Answered

Ask Experts for help!!

Looking for Assignment Help?

Start excelling in your Courses, Get help with Assignment

Write us your full requirement for evaluation and you will receive response within 20 minutes turnaround time.

Ask Now Help with Problems, Get a Best Answer

Section onea in an atwood machine suppose two objects of

SECTION ONE (a) In an Atwood Machine, suppose two objects of unequal mass are hung vertically over a frictionless

Part 1you work in hr for a company that operates a factory

Part 1: You work in HR for a company that operates a factory manufacturing fiberglass. There are several hundred empl

Details on advanced accounting paperthis paper is intended

DETAILS ON ADVANCED ACCOUNTING PAPER This paper is intended for students to apply the theoretical knowledge around ac

Create a provider database and related reports and queries

Create a provider database and related reports and queries to capture contact information for potential PC component pro

Describe what you learned about the impact of economic

Describe what you learned about the impact of economic, social, and demographic trends affecting the US labor environmen