Questions
Masters Machine Shop is considering a four-year project to improve its production efficiency. Buying a new...

Masters Machine Shop is considering a four-year project to improve its production efficiency. Buying a new machine press for $844,800 is estimated to result in $281,600 in annual pretax cost savings. The press falls in the MACRS five-year class (MACRS Table), and it will have a salvage value at the end of the project of $123,200. The press also requires an initial investment in spare parts inventory of $35,200, along with an additional $5,280 in inventory for each succeeding year of the project.

  

If the shop's tax rate is 24 percent and its discount rate is 8 percent, what is the NPV for this project?

Multiple Choice

  • $88,573.56

  • $90,537.75

  • $-17,643.80

  • $93,002.23

  • $84,144.88

In: Finance

Geary Machine Shop is considering a four-year project to improve its production efficiency. Buying a new...

Geary Machine Shop is considering a four-year project to improve its production efficiency. Buying a new machine press for $537,600 is estimated to result in $179,200 in annual pretax cost savings. The press falls in the MACRS five-year class (MACRS Table), and it will have a salvage value at the end of the project of $78,400. The press also requires an initial investment in spare parts inventory of $22,400, along with an additional $3,360 in inventory for each succeeding year of the project.

  

Required :

If the shop's tax rate is 32 percent and its discount rate is 17 percent, what is the NPV for this project? (Do not round your intermediate calculations.)

In: Finance

Geary Machine Shop is considering a four-year project to improve its production efficiency. Buying a new...

Geary Machine Shop is considering a four-year project to improve its production efficiency. Buying a new machine press for $768,000 is estimated to result in $256,000 in annual pretax cost savings. The press falls in the MACRS five-year class (MACRS Table), and it will have a salvage value at the end of the project of $112,000. The press also requires an initial investment in spare parts inventory of $32,000, along with an additional $4,800 in inventory for each succeeding year of the project.

  

Required :

If the shop's tax rate is 31 percent and its discount rate is 8 percent, what is the NPV for this project? (Do not round your intermediate calculations.)

In: Finance

Geary Machine Shop is considering a four-year project to improve its production efficiency. Buying a new...

Geary Machine Shop is considering a four-year project to improve its production efficiency. Buying a new machine press for $892,800 is estimated to result in $297,600 in annual pretax cost savings. The press falls in the MACRS five-year class (MACRS Table), and it will have a salvage value at the end of the project of $130,200. The press also requires an initial investment in spare parts inventory of $37,200, along with an additional $5,580 in inventory for each succeeding year of the project.

  

Required :

If the shop's tax rate is 33 percent and its discount rate is 8 percent, what is the NPV for this project? (Do not round your intermediate calculations.)

In: Finance

Geary Machine Shop is considering a four-year project to improve its production efficiency. Buying a new...

Geary Machine Shop is considering a four-year project to improve its production efficiency. Buying a new machine press for $892,800 is estimated to result in $297,600 in annual pretax cost savings. The press falls in the MACRS five-year class (MACRS Table), and it will have a salvage value at the end of the project of $130,200. The press also requires an initial investment in spare parts inventory of $37,200, along with an additional $5,580 in inventory for each succeeding year of the project.

  

Required :

If the shop's tax rate is 33 percent and its discount rate is 8 percent, what is the NPV for this project? (Do not round your intermediate calculations.)

  

In: Finance

Geary Machine Shop is considering a four-year project to improve its production efficiency. Buying a new...

Geary Machine Shop is considering a four-year project to improve its production efficiency. Buying a new machine press for $806,400 is estimated to result in $268,800 in annual pretax cost savings. The press falls in the MACRS five-year class (MACRS Table), and it will have a salvage value at the end of the project of $117,600. The press also requires an initial investment in spare parts inventory of $33,600, along with an additional $5,040 in inventory for each succeeding year of the project.

If the shop's tax rate is 33 percent and its discount rate is 16 percent, what is the NPV for this project? (Do not round your intermediate calculations.)

In: Finance

Geary Machine Shop is considering a four-year project to improve its production efficiency. Buying a new...

Geary Machine Shop is considering a four-year project to improve its production efficiency. Buying a new machine press for $604,800 is estimated to result in $201,600 in annual pretax cost savings. The press falls in the MACRS five-year class (MACRS Table), and it will have a salvage value at the end of the project of $88,200. The press also requires an initial investment in spare parts inventory of $25,200, along with an additional $3,780 in inventory for each succeeding year of the project.

  

Required :

If the shop's tax rate is 33 percent and its discount rate is 17 percent, what is the NPV for this project? (Do not round your intermediate calculations.)

In: Finance

Geary Machine Shop is considering a four-year project to improve its production efficiency. Buying a new...

Geary Machine Shop is considering a four-year project to improve its production efficiency. Buying a new machine press for $1,142,400 is estimated to result in $380,800 in annual pretax cost savings. The press falls in the MACRS five-year class (MACRS Table), and it will have a salvage value at the end of the project of $166,600. The press also requires an initial investment in spare parts inventory of $47,600, along with an additional $7,140 in inventory for each succeeding year of the project.

  

Required :

If the shop's tax rate is 31 percent and its discount rate is 13 percent, what is the NPV for this project? (Do not round your intermediate calculations.)

In: Finance

Geary Machine Shop is considering a four-year project to improve its production efficiency. Buying a new...

Geary Machine Shop is considering a four-year project to improve its production efficiency. Buying a new machine press for $585,600 is estimated to result in $195,200 in annual pretax cost savings. The press falls in the MACRS five-year class (MACRS Table), and it will have a salvage value at the end of the project of $85,400. The press also requires an initial investment in spare parts inventory of $24,400, along with an additional $3,660 in inventory for each succeeding year of the project.

  

Required :

If the shop's tax rate is 35 percent and its discount rate is 12 percent, what is the NPV for this project? (Do not round your intermediate calculations.)

In: Finance

Masters Machine Shop is considering a four-year project to improve its production efficiency. Buying a new...

Masters Machine Shop is considering a four-year project to improve its production efficiency. Buying a new machine press for $988,800 is estimated to result in $329,600 in annual pretax cost savings. The press falls in the MACRS five-year class (MACRS Table), and it will have a salvage value at the end of the project of $144,200. The press also requires an initial investment in spare parts inventory of $41,200, along with an additional $6,180 in inventory for each succeeding year of the project.

If the shop's tax rate is 24 percent and its discount rate is 11 percent, what is the NPV for this project?

Multiple Choice

$26,323.17

$29,212.46

$-85,094.26

$27,639.33

$25,007.02

In: Finance