subject
Business, 21.12.2019 05:31 arthurdolz

Mountain gear has been using the same machines to make its name brand clothing for the last five years. a cost efficiency consultant has suggested that production costs may be reduced by purchasing more technologically advanced machinery. the old machines cost the company $100,000. the old machines presently have a book value of $60,000 and a market value of $6,000. they are expected to have a five-year remaining life and zero salvage value. the new machines would cost the company $50,000 and have operating expenses of $9,000 a year. the new machines are expected to have a five-year useful life and no salvage value. the operating expenses associated with the old machines are $15,000 a year. the new machines are expected to increase quality, justifying a price increase, and thereby increasing sales revenue by $5,000 a year. select the true statement. a) the company will be $11,000 better off over the 5-year period if it replaces the old equipment. b) the company will be $20,000 better off over the 5-year period if it keeps the old equipment. c) the company will be $12,000 better off over the 5-year period if it replaces the old equipment. d) the company will be $6,000 better off over the 5-year period if it replaces the old equipment.

ansver
Answers: 3

Another question on Business

question
Business, 22.06.2019 14:10
When a shortage or a surplus arises in the loanable funds market a. the supply of loanable funds changes to return the economy to its original real interest rate b. the nominal interest rate is pulled to the new equilibrium level c. the demand for loanable funds changes to return the economy to its original real interest rate d. the real interest rate is pulled to the new equilibrium level
Answers: 3
question
Business, 22.06.2019 15:40
Brandt enterprises is considering a new project that has a cost of $1,000,000, and the cfo set up the following simple decision tree to show its three most likely scenarios. the firm could arrange with its work force and suppliers to cease operations at the end of year 1 should it choose to do so, but to obtain this abandonment option, it would have to make a payment to those parties. how much is the option to abandon worth to the firm?
Answers: 1
question
Business, 22.06.2019 17:10
Storico co. just paid a dividend of $3.15 per share. the company will increase its dividend by 20 percent next year and then reduce its dividend growth rate by 5 percentage points per year until it reaches the industry average of 5 percent dividend growth, after which the company will keep a constant growth rate forever. if the required return on the company’s stock is 12 percent, what will a share of stock sell for today?
Answers: 1
question
Business, 22.06.2019 17:50
The management of a supermarket wants to adopt a new promotional policy of giving a free gift to every customer who spends > a certain amount per visit at this supermarket. the expectation of the management is that after this promotional policy is advertised, the expenditures for all customers at this supermarket will be normally distributed with a mean of $95 and a standard deviation of $20. if the management wants to give free gifts to at most 10% of the customers, what should the amount be above which a customer would receive a free gift?
Answers: 1
You know the right answer?
Mountain gear has been using the same machines to make its name brand clothing for the last five yea...
Questions
question
Biology, 12.03.2020 22:50
question
Mathematics, 12.03.2020 22:50
question
Mathematics, 12.03.2020 22:51
Questions on the website: 13722361