Question

Fuzzy Restaurant is considering the purchase of a $2,500,000 flat top grill. The grill has an...

Fuzzy Restaurant is considering the purchase of a $2,500,000 flat top grill. The grill has an economic life of 8 years and will be fully depreciated using straight-line method. The grill is expected to produce 150,000 tacos per year for the next 8 years, with each costing $1.50 to make and priced at $5. Assume the discount rate is 10% and the tax rate is 21%. The restaurant expects the market value of the grill to be $450,000, 8 years from now.  

Calculate the net present value for the project. (Round to 2 decimals)

Business   Finance   
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
"Paul Restaurant is considering the purchase of a $9,300 soufflé maker. The soufflé maker has an...
"Paul Restaurant is considering the purchase of a $9,300 soufflé maker. The soufflé maker has an economic life of five years and will be fully depreciated by the straight-line method. The machine will produce 1,400 soufflés per year, with each costing $1.97 to make and priced at $4.95. The discount rate is 14 percent and the tax rate is 21 percent. Should the company make the purchase? "
Creole Restaurant is considering the purchase of a $9,500 soufflé maker. The soufflé maker has an...
Creole Restaurant is considering the purchase of a $9,500 soufflé maker. The soufflé maker has an economic life of five years and will be fully depreciated by the straight-line method. The machine will produce 1,750 soufflés per year, with each costing $2.50 to make and priced at $5.00. Assume that the discount rate is 12 percent and the tax rate is 30 percent. What is the NPV of the project?
Paul Restaurant is considering the purchase of a $10,500 soufflé maker. The soufflé maker has an...
Paul Restaurant is considering the purchase of a $10,500 soufflé maker. The soufflé maker has an economic life of 7 years and will be fully depreciated by the straight-line method. The machine will produce 1,400 soufflés per year, with each costing $2.70 to make and priced at $4.70. The discount rate is 11 percent and the tax rate is 24 percent.    What is the NPV of the project?
Paul Restaurant is considering the purchase of a $10,200 soufflé maker. The soufflé maker has an...
Paul Restaurant is considering the purchase of a $10,200 soufflé maker. The soufflé maker has an economic life of 6 years and will be fully depreciated by the straight-line method. The machine will produce 1,400 soufflés per year, with each costing $2.40 to make and priced at $4.85. The discount rate is 13 percent and the tax rate is 21 percent.    What is the NPV of the project? (Do not round intermediate calculations and round your answer to 2...
Calculating Project NPVPaul Restaurant is considering the purchase of a $9,300 soufflé maker. The soufflé maker...
Calculating Project NPVPaul Restaurant is considering the purchase of a $9,300 soufflé maker. The soufflé maker has an economic life of five years and will be fully depreciated by the straight-line method. The machine will produce 1,400 soufflés per year, with each costing $1.97 to make and priced at $4.95. The discount rate is 14 percent and the tax rate is 21 percent. Should the company make the purchase? Please help by BAii plus not excel sheet
Paul Restaurant is considering the purchase of a $11,100 soufflé maker. The soufflé maker has an...
Paul Restaurant is considering the purchase of a $11,100 soufflé maker. The soufflé maker has an economic life of 8 years and will be fully depreciated by the straight-line method. The machine will produce 1,600 soufflés per year, with each costing $2.80 to make and priced at $4.75. The discount rate is 12 percent and the tax rate is 25 percent.    What is the NPV of the project? (Do not round intermediate calculations and round your answer to 2...
Paul Restaurant is considering the purchase of a $9,400 soufflé maker. The soufflé maker has an...
Paul Restaurant is considering the purchase of a $9,400 soufflé maker. The soufflé maker has an economic life of 5 years and will be fully depreciated by the straight-line method. The machine will produce 1,300 soufflés per year, with each costing $2.60 to make and priced at $4.95. The discount rate is 10 percent and the tax rate is 23 percent. What is the NPV of the project? (Do not round intermediate calculations and round your answer to 2 decimal...
Paul Restaurant is considering the purchase of a $10,500 soufflé maker. The soufflé maker has an...
Paul Restaurant is considering the purchase of a $10,500 soufflé maker. The soufflé maker has an economic life of 7 years and will be fully depreciated by the straight-line method. The machine will produce 1,400 soufflés per year, with each costing $2.70 to make and priced at $4.70. The discount rate is 11 percent and the tax rate is 24 percent. What is the NPV of the project? (Do not round intermediate calculations and round your answer to 2 decimal...
(a) Paul Restaurant is considering the purchase of a $9,300 soufflé maker. The soufflé maker has...
(a) Paul Restaurant is considering the purchase of a $9,300 soufflé maker. The soufflé maker has an economic life of five years and will be fully depreciated by the straight-line method. The machine will produce 1,400 soufflés per year, with each costing $1.97 to make and priced at $4.95. The discount rate is 14 percent and the tax rate is 21 percent. Calculate the NPV of the project? (b) We are evaluating a project that costs $604,000, has an 8-year...
Two years ago the Krusty Krab Restaurant purchased a grill for $50,000. The owner, Eugene Krabs,...
Two years ago the Krusty Krab Restaurant purchased a grill for $50,000. The owner, Eugene Krabs, has learned that a new grill is available that will cook Krabby Patties twice as fast as the existing grill. This new grill can be purchased for $80,000 and would be depreciated straight line over 8 years, after which it would have no salvage value. Eugene Krab expects that the new grill will produce an operating income of $50,000 per year for the next...
ADVERTISEMENT
Need Online Homework Help?

Get Answers For Free
Most questions answered within 1 hours.

Ask a Question
ADVERTISEMENT