Question

B. You purchase a new tractor for $110,000 and you expect that it will increase your...

B. You purchase a new tractor for $110,000 and you expect that it will increase your productivity enough to earn you $18,500 per year. The manufacturer has informed you that there is a maintenance cost for this machine of $8,050 after the first year, which increases by 1% each year thereafter. The salvage value is $80,000 minus 2% per year, would you have broken even on this investment after 5 years? Assume an APR of 6% compounded yearly.

Engineering   Civil-Engineering   
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
One year​ ago, your company purchased a machine used in manufacturing for $110,000. You have learned...
One year​ ago, your company purchased a machine used in manufacturing for $110,000. You have learned that a new machine is available that offers many advantages and you can purchase it for $160,000 today. It will be depreciated on a​ straight-line basis over 10 years and has no salvage value. You expect that the new machine will produce a gross margin​ (revenues minus operating expenses other than​ depreciation) of $45,000 per year for the next 10 years. The current machine...
One year​ ago, your company purchased a machine used in manufacturing for $ 110,000. You have...
One year​ ago, your company purchased a machine used in manufacturing for $ 110,000. You have learned that a new machine is available that offers many advantages and you can purchase it for $ 170,000 today. It will be depreciated on a​ straight-line basis over 10 years and has no salvage value. You expect that the new machine will produce a gross margin​ (revenues minus operating expenses other than​ depreciation) of $ 60,000 per year for the next 10 years....
You are looking to purchase a new car, and you expect to have annual maintenance costs...
You are looking to purchase a new car, and you expect to have annual maintenance costs to keep it running. According to your calculations, you expect to incur $150 maintenance costs in the first year and expect the costs to increase by $75 for the next 7 years. You plan to keep the car for 8 years in total. How much money should you have in your savings account today, so that you do not have to worry about maintenance?...
One year​ ago, your company purchased a machine used in manufacturing for $ 110 comma 000$110,000....
One year​ ago, your company purchased a machine used in manufacturing for $ 110 comma 000$110,000. You have learned that a new machine is available that offers many​ advantages; you can purchase it for $ 150 comma 000$150,000 today. It will be depreciated on a​ straight-line basis over ten​ years, after which it has no salvage value. You expect that the new machine will contribute EBITDA​ (earnings before​ interest, taxes,​ depreciation, and​ amortization) of $ 60 comma 000$60,000 per year...
You plan to retire 37 years from now. You expect that you will live 25 years...
You plan to retire 37 years from now. You expect that you will live 25 years after retiring. You want to have enough money upon reaching retirement age to withdraw $110,000 from the account at the beginning of each year you expect to live, and yet still have $2,500,000 left in the account at the time of your expected death (62 years from now). You plan to accumulate the retirement fund by making equal annual deposits at the end of...
One year​ ago, your company purchased a machine used in manufacturing for $110,000. You have learned...
One year​ ago, your company purchased a machine used in manufacturing for $110,000. You have learned that a new machine is available that offers many advantages and that you can purchase it for $150,000 today. The CCA rate applicable to both machines is 20%​; neither machine will have any​ long-term salvage value. You expect that the new machine will produce earnings before​ interest, taxes,​ depreciation, and amortization​ (EBITDA) of $40,000 per year for the next 10 years. The current machine...
(b) You plan to save 10% of your yearly salary of $80,000 for retirement in a...
(b) You plan to save 10% of your yearly salary of $80,000 for retirement in a mutual fund earning 9% per year. Your salary will increase by 5% per year for 30 years when you retire. How much money will you have when you retire? (b) How much can you spend per year if you will live for 25 years after retirement if you can earn 8% on your money?
1. You love to swim and are considering whether to install a pool in your house...
1. You love to swim and are considering whether to install a pool in your house or just have a membership to a private swimming pool. To install a pool will cost you $20,000 today and $200 per month for maintenance costs (the maintenance costs start next month and go for 20 years). If you join the private swimming pool, it will cost you $500 per month, starting next month, for 20 years. If your investments earn 5% APR (compounded...
On your 30th birthday your employer SWFC Corporation, has invited you to join their pension scheme....
On your 30th birthday your employer SWFC Corporation, has invited you to join their pension scheme. You are paid $60,000 per year, and at the end of each year the company contributes an additional 10% of your salary to the scheme. How much money will be in your fund at age 60 (your projected retirement age), if the fund expects to earn an average rate of 11% p.a.? After retiring at age 60, you want to use your cash payout...
You have finished your time at Kelley and need to start thinking about retirement. You plan...
You have finished your time at Kelley and need to start thinking about retirement. You plan on working for 20 more years and then retire. Upon your retirement 20 years from today, you plan to have enough money to withdraw $10,000 per month, with the first payment coming exactly one month after your retirement day. You expect your retirement account to earn a return of 8% APR (stated rate), compounded monthly, on all funds in the retirement account. Assuming you...
ADVERTISEMENT
Need Online Homework Help?

Get Answers For Free
Most questions answered within 1 hours.

Ask a Question
ADVERTISEMENT