2ND QUESTION - $207,873.01 Total $(2,930,290 Conclusion NPV...

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Cash flow New sewing machine Year NPV 0 new purachase $(2,500,000.00) $(2,500,000.00) training cost $(85,000.00) $(85,000.00) total expense $(2,585,000.00) $(2,585,000.00) 1 $390,000.00 $357,798.17 2 $400,000.00 $336,672.00 3 $411,000.00 $317,367.41 4 $426,000.00 $301,789.14 5 $434,000.00 $(95,000.00) $220,326.74 6 $435,000.00 $259,376.29 7 $436,000.00 $238,506.93 Salvage $380,000.00
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Unformatted text preview: $207,873.01 Total $(2,930,290) Conclusion: NPV new machine purchasing is higher than old machine, therefore, we Cash flow Old machine Year NPV-5 $(1,800,000.00) $(589,824.00)-6 months $(55,000.00) $(57,421.69) sold price $260,000.00 $260,000.00 Total $(387,245.69) e should purchase new machine to replace existing machine....
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This note was uploaded on 08/22/2011 for the course ACCOUNTING 201 taught by Professor Stevejoseph during the Winter '11 term at Aarhus Universitet.

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2ND QUESTION - $207,873.01 Total $(2,930,290 Conclusion NPV...

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