Managerial Accounting Quiz 65.pdf - 30 Award 10.00 points Problems Adjust credit for all students Heels a shoe manufacturer is evaluating the costs and

Managerial Accounting Quiz 65.pdf - 30 Award 10.00 points...

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30.Award: 10.00pointsProblems? Adjust credit for all students.Heels, a shoe manufacturer, is evaluating the costs and benefits of new equipment that would customfit each pair of athletic shoes. The customer would have his or her foot scanned by digital computerequipment; this information would be used to cut the raw materials to provide the customer a perfectfit. The new equipment costs $90,000 and is expected to generate an additional $35,000 in cash flowsfor five years. A bank will make a $90,000 loan to the company at a 10% interest rate for thisequipment’s purchase. Use the following table to determine the break-even time for this equipment. Allcash flows occur at year-end. (PV of $1, FV of $1, PVA of $1, and FVA of $1) (Use appropriatefactor(s) from the tables provided. Cumulative net cash outflows must be entered with a minussign. Round your present value factor to 4 decimals. Round your answers to whole dollars.Round "Break even time" answer to 1 decimal place.) $ Chart Values are Based on: i = 10 % Year Cash Inflow (Outflow) x PV Factor = Present Value Cumulative Present Value of Inflow (Outflow) 0 (90,000) 1.0000 = 1 35,000 0.9091 = 31,819 (58,181) 2 35,000 0.8264 = 28,924 (29,257) 3 0.7513 = (2,961) 4 0.6830 = 20,944 5 0.6209 = 42,676 3.2 x $ (90,000) $ (90,000) x x 35,000 x 26,296 35,000 x 23,905 35,000 x
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