Business Case:
The Managerial Accounting Department at your company has been engaged by the Production Department for
assistance in evaluating a purchase decision. The equipment the production department is currently utilizing is outdated
and has become costly to maintain. New machines would also provide increased efficiencies leading to increased sales.
Due to this, the department is considering replacing all equipment with new machines.
Data:
- Cost of Current Machines: $800,000
- Cost of New Machines: $1,250,000
- Annual Maintenance on Current Machines: $125,000
- Annual Maintenance on New Machines: $54,000
- Salvage Value of Current Machines: $325,000
- Immediate employee training cost on new machines: $15,000
- Working Capital needed for new machines: $50,000
- Would be needed once machines are purchased and working capital released after 5 years
- Increased sales opportunity provided by new machines: $200,000 first year and growing at 5% per year
after
- Company’s Required Rate of Return: 10%
- Contribution margin: 47%
- Depreciation and income taxes should be ignored.

1. Explain to me the decision you are assisting the department with and at a high level and
how you will assist.
2. Define in your own words: Relevant Costs/Revenues (look to previous chapters to assist), Net Present
Value, Internal Rate of Return, and Contribution Margin.
3. Identify and list the relevant costs and revenues to be included in the decision. For this week you only
need to list the name or description of the expense.

A​ company's old antihistamine formula provided relief for 68​% of the people who used it. The company tests a new formula to see if it is​ better, and gets a​ P-value of 0.29. State the null and alternative hypotheses. Is it reasonable to conclude that the new formula and the old one are equally​ effective? Explain. What is the null​ hypothesis? Upper H 0 : ▼ p ModifyingAbove p with caret y overbar mu ▼ not equals less than less than or equals greater than or equals greater than equals ▼ 29 71 0.68 0.29 What is the alternative​ hypothesis? Upper H Subscript Upper A Baseline : ▼ p y overbar mu ModifyingAbove p with caret ▼ equals greater than or equals greater than less than less than or equals not equals ▼ 29 71 0.68 0.29 Choose the correct answer below. A. Since the​ P-value is greater than ​0.05, it seems that the new formula is more effective than the old one. B. It is not reasonable to conclude that the new formula and the old one are equally effective. There is a 29​% chance the new formula is better than the old one. C. It is not reasonable to conclude that the new formula and the old one are equally effective. The​ P-value cannot suggest this conclusion. D. Since the​ P-value is greater than ​0.05, it seems that the new formula is equally effective as the old one. Click to select your answer.

Conch Republic spent $750,000 to develop a prototype for a new smart phone that has all the features of the existing one but adds new features such as wifi tethering. The company has spent a further $200,000 for a marketing study to determine the expected sales figures for the new smart phone. Conch Republic can manufacture the new smart phone for $205 each in variable costs. Fixed costs for the operation are estimated to run $5.1 million per year. The estimated sales volume is 64,000, 106,000, 87,000, 78,000, and 54,000 per year for the next five years, respectively. The unit price of the new smart phone will be $485. The necessary equipment can be purchased for $34.5 million and will be depreciated on a seven-year MACRS schedule. It is believed the value of the equipment in five years will be $5.5 million. Net working capital for the smart phones will be 20 percent of sales and will occur with the timing of the cash flows for the year (i.e., there is no initial out-lay for NWC). Changes in NWC will thus first occur in Year 1 with the first year's sales. Conch Republic has a 35 percent corporate tax rate and a required return of 12 percent. Shelly has asked Jay to prepare a report that answers the following questions:

e. How sensitive is the NPV to changes in the price of the new smart phone?

f. How sensitive is the NPV to changes in the quantity sold?

g. Should Conch Republic produce the new smart phone?

Bilboa Freightlines, S.A., of Panama, has a small truck that it uses for intracity deliveries. The truck is worn out and must be either overhauled or replaced with a new truck. The company has assembled the following information:

If the company keeps and overhauls its present delivery truck, then the truck will be usable for five more years. If a new truck is purchased, it will be used for five years, after which it will be traded in on another truck. The new truck would be diesel-operated, resulting in a substantial reduction in annual operating costs, as shown above.

The company computes depreciation on a straight-line basis. All investment projects are evaluated using a 13% discount rate.

Click here to view Exhibit 13B-1 and Exhibit 13B-2, to determine the appropriate discount factor(s) using tables.

Required:

1. What is the net present value of the “keep the old truck” alternative?

2. What is the net present value of the “purchase the new truck” alternative?

3. Should Bilboa Freightlines keep the old truck or purchase the new one?

Bilboa Freightlines, S.A., of Panama, has a small truck that it uses for intracity deliveries. The truck is worn out and must be either overhauled or replaced with a new truck. The company has assembled the following information:

If the company keeps and overhauls its present delivery truck, then the truck will be usable for five more years. If a new truck is purchased, it will be used for five years, after which it will be traded in on another truck. The new truck would be diesel-operated, resulting in a substantial reduction in annual operating costs, as shown above.

The company computes depreciation on a straight-line basis. All investment projects are evaluated using a 9% discount rate.

Click here to view Exhibit 12B-1 and Exhibit 12B-2, to determine the appropriate discount factor(s) using tables.

Required:

1. What is the net present value of the “keep the old truck” alternative?

2. What is the net present value of the “purchase the new truck” alternative?

3. Should Bilboa Freightlines keep the old truck or purchase the new one?

Hat Tricks Company (HTC) is a Buffalo, New York, manufacturer of hats and gloves. Recently, the company purchased a new machine to aid in producing the hat product lines. Production efficiency on the new machine increases with the workforce experience. It has been shown that as cumulative output on the new machine increases, average labor time per unit decreases up to the production of at least 3,200 units. As HTC’s cumulative output doubles from a base of 100 units produced, the cumulative average labor time per unit declines by a learning rate of 80%.

HTC has developed a new style of men’s hat to be produced on the new machine. One hundred of these hats can be produced in a total of 40 labor hours. All other direct costs to produce each hat are $12 per hat, excluding direct labor cost. Direct labor cost per hour is $25. Fixed costs are $8,000 per month, and HTC has the capacity to produce 3,200 hats per month.

Required:

HTC plans to set the selling price for the new men’s hat at 200% of direct production cost. If the company is planning to sell 100 hats, what is the selling price? If the plan is to sell 800 hats, what should be the selling price? (Do not round intermediate calculations. Round your answers to 2 decimal places.)

2.   Understanding what maturity risk means for bonds is very important. Complete the following table by calculating the new bond prices and then the % price change that results for the two bonds given. For example, in the table if interest rates go up 1% on the short term bond, that means that the YTM would go from 4% to 5%. Then calculate the new price at a YTM of 5% and then calculate the % change in price from today's price of $1,000 to the new price.

Short term bond: Face value of $1,000 with an annual coupon rate of 4% with semi-annual payments, and a maturity in 2 years. Assume that today's YTM on a 2 year bond is 4% so therefore today's price is $1,000.

Long term bond: Face value of $1,000 with an annual coupon rate of 5% with semi-annual payments, and a maturity in 30 years. Assume that today's YTM on a 30 year bond is 5% so therefore today's price is $1,000.

The critical care nurse is mentoring a new nurse on hemodynamic mentoring at the bedside of a critical ill patient. the patient has a right radial intra arterial line and a right sub clavian pulmonary artery pressure monitoring system with a thermodilution catheter. the critical care nurse meet with new nurse demonstrates proper management of the invasive hemodynamic monitoring lines to the new nurse and obtains the order paramiter (mean arterial pressure (map) central venous pressure (cvp) oulmonary artery systolic (pas) pulmonary artery diastolic (pad) pulmonary artery wedge pressure (pawp) cardiac output (co) and cardiac index (ci) measurement)   the critical care nurse the critical care nurse meet with the new nurse afterwards at the nurses station and encourage the new nurse to share what the new nurse understand in eegards to the invasive hemodynamic monetering .the new nurse is currently taking critical care classes on hemody namic monitering                                                                
                                                                                          A. what are the indications for the carious homodynamic monitering methods ( intra artirial line) and the pulmonary arteryd pressure monitoring system.                                                         

B.   what are the various ordered perameters use for in the case study
              
C. what are the nursing responsibilities when caring for the patient with hemodynamic monitoring.

of what potential complication
should the nurse be aware when caring for thre patient with hemodynamic monitoring

Factor Company is planning to add a new product to its line. To manufacture this product, the company needs to buy a new machine at a $487,000 cost with an expected four-year life and a $19,000 salvage value. All sales are for cash, and all costs are out-of-pocket, except for depreciation on the new machine. Additional information includes the following. (PV of $1, FV of $1, PVA of $1, and FVA of $1) (Use appropriate factor(s) from the tables provided.)

Required:
1. Compute straight-line depreciation for each year of this new machine’s life.
2. Determine expected net income and net cash flow for each year of this machine’s life.
3. Compute this machine’s payback period, assuming that cash flows occur evenly throughout each year.
4. Compute this machine’s accounting rate of return, assuming that income is earned evenly throughout each year.
5. Compute the net present value for this machine using a discount rate of 7% and assuming that cash flows occur at each year-end. (Hint: Salvage value is a cash inflow at the end of the asset’s life.)

Factor Company is planning to add a new product to its line. To manufacture this product, the company needs to buy a new machine at a $820,000 cost with an expected four-year life and a $54,000 salvage value. All sales are for cash, and all costs are out-of-pocket, except for depreciation on the new machine. Additional information includes the following. (PV of $1, FV of $1, PVA of $1, and FVA of $1) (Use appropriate factor(s) from the tables provided. Round PV factor value to 4 decimal places.) Expected annual sales of new product $ 2,690,000 Expected annual costs of new product Direct materials 514,000 Direct labor 706,000 Overhead (excluding straight-line depreciation on new machine) 676,000 Selling and administrative expenses 194,000 Income taxes 30 % Required: 1. Compute straight-line depreciation for each year of this new machine’s life. 2. Determine expected net income and net cash flow for each year of this machine’s life. 3. Compute this machine’s payback period, assuming that cash flows occur evenly throughout each year. 4. Compute this machine’s accounting rate of return, assuming that income is earned evenly throughout each year. 5. Compute the net present value for this machine using a discount rate of 4% and assuming that cash flows occur at each year-end. (Hint: Salvage value is a cash inflow at the end of the asset’s life.)