As an intern in a manufacturing company, you are assigned to evaluate two alternative production quality-tracking...

As an intern in a manufacturing company, you are assigned to evaluate two alternative production quality-tracking systems. System I costs $285 000 and has three-year life. The before-tax cash operating costs are $62 000 per year. System II costs $420 000, has a five year life with the after tax costs of $34 000 per year. For both systems, straight-line depreciation is used. The resulting book value will be zero for both systems but the estimated value is around 10% of the purchase price. The tax rate is 30% and the cost of capital is 10%. Evaluate the after-tax cash flows for both alternatives and find the best alternative by considering equivalent annuities (more precisely equivalent annual cost, EAC).

yes, it is ocf

Expert Solution

jeff jeffy answered 8 months ago

You are an MPH student intern in a local church. Part of your assigned tasks is...

You are an MPH student intern in a local church. Part of your assigned tasks is to research the possibility of getting a grant to fund a new Head Start preschool program in the church. You find out the following: You are planning a weight control program in your church. You have assessed the need and interest; you have identified program goals and outcomes; you have selected resources and materials; all you have left to do is plan the evaluation....

Evaluate GDP as a measure of quality of life. Explain in detail and offer alternative measures

Horizon Co is a manufacturing company that wishes to evaluate an investment in new production machinery....

Horizon Co is a manufacturing company that wishes to evaluate an investment in new production machinery. The machinery would enable the company to satisfy increasing demand for existing products and the investment is not expected to lead to any change in the existing level of business risk of Horizon Co. The machinery will cost Rs.2·5 million, payable at the start of the first year of operation, and is not expected to have any scrap value. Annual before-tax net cash flows...

You are assigned to compare call times between two different groups. What questions must you evaluate...

You are assigned to compare call times between two different groups. What questions must you evaluate prior to selecting the appropriate statistical test? What are the risks of selecting the wrong test? Illustrate by providing specific examples.

A laptop manufacturing company has implemented a 2-step process to test the quality of each production...

A laptop manufacturing company has implemented a 2-step process to test the quality of each production batch. In the first step, a technician randomly selects 15 laptops from the batch and determines whether they meet specifications. The batch is considered acceptable provided no more than 1 laptop fails to meet specifications. Otherwise, the entire batch must be tested in the second step. Historical data shows that 95% of the laptops produced adhere to specifications. Discuss the following: What are the...

You are the production manager for a part manufacturing company. There are 2 manufacturing locations, plant...

You are the production manager for a part manufacturing company. There are 2 manufacturing locations, plant A and B. you suspect there is a difference in the proportion of rejected parts that are manufactured at Plant A as compared to plant B. for a week you observed: Plant A Plant B total Rejected parts 120 80 200 Acceptable parts 1880 1920 3800 2000 2000 4000 The proportion of rejected parts was 200/4000=5%. If there were no difference between the proportion...

You are the Quality Leader for a manufacturing company that produces a composite product. A new...

You are the Quality Leader for a manufacturing company that produces a composite product. A new product has been designed and your company will be manufacturing these items. After the initial pilot run your inspector reports the process output as follows; µ = 1132 grams s = 37 grams Customer specifications are; LSL = 1100 g USL = 1200 g 1. Draw a model for this process (normal curve) with the mean, upper 3s, lower 3s as well as the...

Critically evaluate alternative sources of debt and equity finance for a company. Within your evaluation you...

Critically evaluate alternative sources of debt and equity finance for a company. Within your evaluation you are also required to propose criteria the company might use when considering which financing method(s) to use. (700 words)

An engineering company has two alternatives for improving a production line. Alternative A has first costs...

An engineering company has two alternatives for improving a production line. Alternative A has first costs of $3,000, a salvage value of $500, and a service life of 3 years. Alternative B has equipment costs of $4,500, a salvage value of $1,000, and a service life of 6 years. Use a present worth analysis to determine which alternative is economically superior with i=10%. Your solution will be closest to: a. Alternative A @ - $3,300 b. Alternative B @ -...

You are a summer intern for a large, reputable sports beverage company. The company is the...

You are a summer intern for a large, reputable sports beverage company. The company is the primary sponsor of an Olympic-distance triathlon in August in Iowa. The company will have a huge exhibit booth at the prerace meal the night before the race, and before, during, and after the event on race day. Your responsibility as an intern is to create a sports nutrition table display to be the centerpiece of the company’s main exhibit area. Describe in detail what...

Question