dothithuyphuong - Answer 1 years intialcost...

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Answer 1) years 0 1 2 3 4 5 intial cost (\$10,000) annual cash inflows 5,200 5,200 5,200 5,200 5,200 Salvage Value  rate  16% NPV (10 years) \$15,328.20  2) Years 0 1 2 3 4 5 intial cost (\$10,000) annual cash inflows 5,200 5,200 5,200 5,200 5,200 Salvage Value  rate  10% NPV (10 years) \$22,302.24  3) 0 Years (\$10,000) 1 2 3 4 5 intial cost annual cash inflows 2,700 2,700 2,700 2,700 2,700 Salvage Value  rate  16% NPV (10 years) \$3,245.13  4) Years 0 1 2 3 4 5 intial cost (\$12,000) annual cash inflows 5,200 5,200 5,200 5,200 5,200 Salvage Value  rate  16% NPV (12 years) \$15,170.18  Explanation  Franklin Bakery is considering buying a new doughnut-making machine. The cost of the machine is The annual operating cost of the doughnut machine are projected to be as follows. Note : These cost projection are based on the forecasted sales level of 15,000Doughnuts per yea Raw Material \$2,250 Direct labor 1,200 \$10,000. The machine will last for ten years and is expected to be worth \$1,000 as scrap at that

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1,650 900 Direct fixed cost 3,000 Indirect fixed cost 4,000 The indirect fixed costs presents the routine allocation of general company overhead to project Franklin Bakery has determined that the appropriate cost of capital to use in evaluating this dou Required : 2. Assume that the appropriate cost of capital is 10% instead of 16%.Compute the net present
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dothithuyphuong - Answer 1 years intialcost...

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