Question

Lesco Chemical is considering two processes for making a cationic polymer. Process A has a first...

Lesco Chemical is considering two processes for making a cationic polymer. Process A has a first cost of $118,000 and an annual operating cost (AOC) of $56,000 per year. The first cost of process B is $165,000. If both processes will be adequate for 4 years and the rate of return on the increment between the alternatives is 25%, what is the amount of the AOC for process B? The amount of the AOC for process B is $

Math   Advanced-Math   
0 0
Add a commentTranscribed image text
Next >

Homework Answers

Answer #1

0 0
Know the answer?
Your Answer:

Post as a guest

Your Name:

What's your source?

Earn Coins

Coins can be redeemed for fabulous gifts.

Log In

Sign Up

Not the answer you're looking for?
Ask your own homework help question
Similar Questions
Lesco Chemical is considering two processes for making a cationic polymer. Process A has a first...
Lesco Chemical is considering two processes for making a cationic polymer. Process A has a first cost of $106,000 and an annual operating cost (AOC) of $62,000 per year. The first cost of process B is $165,000. If both processes will be adequate for 7 years and the rate of return on the increment between the alternatives is 25%, what is the amount of the AOC for process B?
Lesco chemical is considering two processes for making a cationic polymer. Process A has a first...
Lesco chemical is considering two processes for making a cationic polymer. Process A has a first cost of $100,000 and an AOC of $60,000 per year. Process B has a first cost of $165,000. If both processes will be adequate for 4 years and the rate of return on the increment between the alternatives is 20%, what is the amount of the AOC for process B?
"A company is considering two types of machines for a manufacturing process. Machine A has an...
"A company is considering two types of machines for a manufacturing process. Machine A has an immediate cost of $87,000, and its salvage value at the end of 8 years of service life is $29,000. The operating costs of this machine are estimated to be $5700 per year. Extra income taxes are estimated at $1500 per year. Machine B has an immediate cost of $44,000, and its salvage value at the end of 8 years' service is neglible. The annual...
"A company is considering two types of machines for a manufacturing process. Machine A has an...
"A company is considering two types of machines for a manufacturing process. Machine A has an immediate cost of $61,000, and its salvage value at the end of 4 years of service life is $14,000. The operating costs of this machine are estimated to be $3900 per year. Extra income taxes are estimated at $1800 per year. Machine B has an immediate cost of $45,000, and its salvage value at the end of 4 years' service is neglible. The annual...
Either of the cost alternatives shown below can be used in a chemical refining process. If...
Either of the cost alternatives shown below can be used in a chemical refining process. If the company’s MARR is 15% per year, determine which should be selected on the basis of an incremental ROR analysis. A B First cost ,$ − 40,000 − 61,000 Annual cost, $/year − 25,000 − 19,000 Salvage value, $ 8,000 11,000 Life, years 5 5 5       -       A.       B.       C.       D.       E....
(25pts) Sandersen Meat Processors has asked its lead process engineer to evaluate two different types of...
(25pts) Sandersen Meat Processors has asked its lead process engineer to evaluate two different types of conveyors for the beef cutting line. Type A has an initial cost of $87422 and a life of 4 years. Type B has an initial cost of $98965 and a life expectancy of 6 years. The annual operating cost (AOC) for type A is expected to be $8774, while the AOC for type B is expected to be $7147. If the salvage values are...
Polytec Chemical, Inc. must decide between two additives to improve the dry-weather stability of its low-cost...
Polytec Chemical, Inc. must decide between two additives to improve the dry-weather stability of its low-cost acrylic paint. Additive A will have an equipment and installation cost of $118,000 and an annual cost of $55,000. Additive B will have an installation cost of $175,000 and an annual cost of $34,000. If the company uses a five-year recovery period for paint products and an MARR of 24% per year, which process is favored on the basis of an incremental rate of...
Two mutually exclusive alternatives are being considered. Both have lives of 5 years. Alternative A has...
Two mutually exclusive alternatives are being considered. Both have lives of 5 years. Alternative A has a first cost of $2500 and annual benefits of $746. Alternative B costs $6000 and has annual benefits of $1664. The minimum attractive rate of return is 8%. (a) What is the incremental rate of return between the two alternatives? (b) Which alternative should be selected? Please explain your response a step by step.
Exercise 13-7 Net Present Value Analysis of Two Alternatives [LO13-2] Perit Industries has $165,000 to invest....
Exercise 13-7 Net Present Value Analysis of Two Alternatives [LO13-2] Perit Industries has $165,000 to invest. The company is trying to decide between two alternative uses of the funds. The alternatives are: Project A Project B Cost of equipment required $ 165,000 $ 0 Working capital investment required $ 0 $ 165,000 Annual cash inflows $ 21,000 $ 56,000 Salvage value of equipment in six years $ 9,500 $ 0 Life of the project 6 years 6 years The working...
Mariposa Inc is considering improving its production process by acquiring a new machine. There are two...
Mariposa Inc is considering improving its production process by acquiring a new machine. There are two machines management is analyzing to determine which one it should purchase. The company requires a 14% rate of return and uses straight-line depreciation to a zero book value. Machine A has a cost of $290,000, annual operating costs of $8,000, and a 3-year life. Machine B costs $180,000, has annual operating costs of $12,000, and has a 2-year life. Whichever machine is purchased will...
ADVERTISEMENT
Need Online Homework Help?

Get Answers For Free
Most questions answered within 1 hours.

Ask a Question
ADVERTISEMENT