Use tables and cash flow diagram: The energy costs of a company involved in powder coating...

Use tables and cash flow diagram: The energy costs of a company involved in powder coating of outdoor furniture are expected to increase at a rate of $400 per year. The cost at the end of the next year (year 1) is expected to be $13,000. How many years will it be from now before the equivalent annual cost is $16,000 per year, if interest is 8% per year?

Expert Solution

Lets put the information given in the question

The cost is expected to increase 400 per year. So this is the pmt. pmt =400

Cost at the end of year 1 is 13000. So we can take this as pv.

Interest rate is given as 8%.

Let the number of year be n. At the end of year n, the cost is supposed to be 16000. So we can take this as fv.

Given all these details we can find n using the nper formula in excel.

=NPER(8%,400,-13000,16000,0)

=4.14

YOU can even use financial calculator to find the same. Just input the values shwon in the image in the calculator to find n. Give pv value as -13000 to get the correct answer.

Rahul Sunny answered 1 year ago

Use tables and cash flow diagram: The equivalent annual worth of an increasing arithmetic gradient is...

Use tables and cash flow diagram: The equivalent annual worth of an increasing arithmetic gradient is $135,300. If the cash flow in year 1 is $35,000 and the gradient amount is $19,000, what is the value of n at an interest rate of 10% per year?

Draw a cash flow diagram for a cash flow that starts at $1,000 at the end...

Draw a cash flow diagram for a cash flow that starts at $1,000 at the end of the first month and increases by $100 each month after that in perpetuity with an interest rate of 21% annual compounded monthly (Draw at least the first 5 months). What is the present value of this cash flow?

Draw the cash flow diagram for the following data. A company purchases a machine to make...

Draw the cash flow diagram for the following data. A company purchases a machine to make widgets for $10,000. the collect payment for their widgets at the end of the year in which they are delivered. At the end of 5 years the machine must be scrapped at which time its value is $0. The following is the net revenue generated by the widget machine. Year 1 - $2,500 Year 2 - $3,500 Year 3 - $2,250 Year 4 -...

Draw a cash flow diagram for the problem. A company manufactures electrical metering devices that monitor...

Draw a cash flow diagram for the problem. A company manufactures electrical metering devices that monitor power quality. The company’s fixed cost is $68,000 per month. The variable cost is $80 per metering device. The selling price per device can be modeled by S = 170 – 0.05 Q where S is the selling price and Q is the number of metering devices sold. How many metering devices must the company sell per month in order to realize a maximum...

Draw a cash flow diagram on EXCEL using the data below Year Cash Flow 0 -5,000...

Draw a cash flow diagram on EXCEL using the data below Year Cash Flow 0 -5,000 1 1000 2 2000 3 3000 4 4000 5 -1000

Using a cash flow diagram draw a diagram for $10,000 invested now, and in 5 years...

Using a cash flow diagram draw a diagram for $10,000 invested now, and in 5 years it grows to $30,000.

Using a flow diagram (arrows), describe the pathway of pulmonary circulation. List the valves involved in...

Using a flow diagram (arrows), describe the pathway of pulmonary circulation. List the valves involved in each pathway.

Tables 1—3 shows the production costs of the Deering Manufacturing Company. Use the data and answer...

Tables 1—3 shows the production costs of the Deering Manufacturing Company. Use the data and answer questions 5-7. Table 1. Output Fixed Cost Variable Cost Total Cost Average Cost 1 25 7 32 2 25 18 43 3 25 33 58 4 25 52 77 Table 2. Output Fixed Cost Variable Cost Total Cost Average Cost 5 30 75 105 6 30 102 132 7 30 133 163 8 30 168 198 Table 3. Output Fixed Cost Variable Cost Total...

Inputs: Use 2 inputs: cash flow vector, interest rate. Use values: cash flow = (-10, 2,...

Inputs: Use 2 inputs: cash flow vector, interest rate. Use values: cash flow = (-10, 2, 4, 5, 9, 6), interest rate = 12%. Assume that cash flows start at t=0 and go on year by year. Output: Produce a table containing years, cash flows, PV of cash flows, and a summary with NPV, PI, and Payback. (Rstudio)

what is the cash flow diagram for this question? Beckman Technologies, a relatively small manufacturer of...

what is the cash flow diagram for this question? Beckman Technologies, a relatively small manufacturer of precision laboratory equipment, borrowed $2 million to renovate one of its testing labs. In an effort to pay off the loan quickly, the company made four payments in years 1 through 4, with each payment being twice as large as the preceding one. At an interest rate of 10% per year, what was the size of the fi rst payment?

Question