Business, 05.05.2020 06:14 marziel24

Grady Corp. is considering the purchase of a new piece of equipment. The equipment costs $51,500, and will have a salvage value of $5,040 after six years. Using the new piece of equipment will increase Grady’s annual cash flows by $6,190. Grady has a hurdle rate of 12%. (Future Value of $1, Present Value of $1, Future Value Annuity of $1, Present Value Annuity of $1.) (Use appropriate factor from the PV tables.) a. What is the present value of the increase in annual cash flows? (Round your answer to 2 decimal places.) b. What is the present value of the salvage value? (Round your answer to 2 decimal places.) c. What is the net present value of the equipment purchase? (Negative value should be indicated by a minus sign. Round your intermediate calculation and final answer to 2 decimal places.) d. Based on financial factors, should Grady purchase the equipment? Yes No

Answers: 1

Show answers

Another question on Business

Business, 22.06.2019 14:30

What’s the present value of a perpetuity that pays $250 per year if the appropriate interest rate is 5%? $4,750 $5,000 $5,250 $5,513 $5,788what is the present value of the following cash flow stream at a rate of 8.0%, rounded to the nearest dollar? cash flows: today (t = 0) it is $750, after one year (t = 1) it is $2,450, at t = 2 it is $3,175, and at t=3 it is $4,400. draw a time line. $7,917 $8,333 $8,772 $9,233 $9,695

Answers: 2

Answer

Business, 22.06.2019 20:50

How has apple been able to sustain its competitive advantage in the smartphone industry? a. by reducing its network effects b. by targeting its new products and services toward laggards c. by driving the price for the end user to zero d. by regularly introducing incremental improvements in its products

Answers: 1

Answer

Business, 23.06.2019 00:30

You get your monthly banking statement and notice that the number is lower than expected. you decide that you should create a cash flow statement. why are cash flow statements useful in managing money? what are the steps in creating a statement?

Answers: 1

Answer

Business, 23.06.2019 01:00

Tariffs and quotas are often imposed when a government is more responsive to interests, and the benefits of those trade restrictions are often ; concentrated producer; widely dispersed consumer; widely dispersed consumer; concentrated

Answers: 3

Answer

You know the right answer?

Grady Corp. is considering the purchase of a new piece of equipment. The equipment costs $51,500, an...

Questions