Letang Industrial Systems Company (LISC) is trying to decide between two different conveyor belt systems. System A costs $280,000, has a four-year life, and requires $85,000 in pretax annual operating costs. System B costs $360,000, has a six-year life, and requires $79,000 in pretax annual operating costs. Both systems are to be depreciated straight-line to zero over their lives and will have zero salvage value. Whichever project is chosen, it will not be replaced when it wears out. The tax rate is 23 percent and the discount rate is 10 percent.

Answers

Answer 1

We have to calculate the EAC for both the conveyor belt system.

Solutions :

Equivalent Annual Cost or (EAC) for the SYSTEM-A

[tex]$\text{Operating cash flow } = \text{Pre-tax annual operating cost (1-tax rate )} + (\text{depreciation expense} \times $[/tex]tax rate )

                                [tex]$=-855,000(1-0.23)+\left[\left(\frac{280,000}{4}\right)\times 0.23\right]$[/tex]

                               [tex]$= (-85,000 \times 0.77 ) + (70,000 \times 0.23)$[/tex]

                               = $ 49,350

Year      Annual Cost flow     Present value factor    Present Value of Annual

                                                     at 10%                              cash flow

1                    -49,350                  0.909091                          -44,863.64

2                  -49,350                   0.826446                          -40,785.12

3                   -49,350                  0.751315                            -37,077.39

4                   -49,350                 0.683013                         -33,706.71  

     Total                                    $ 3.169865                       $ -156,432.86  

Therefore, Net Present value = present value of the annual cash flow - initial investment.

           = 156,432.86 - 280,000

          = $ 436,432.86 (negative)

Now the EAC or the Equivalent Annual Cost for System A :

[tex]$\text{EAC}= \text{Net present value / (PVIFA 10 percent, 4 years)}$[/tex]

        [tex]$=\frac{436,432.86}{3.169865}$[/tex]

        [tex]$= 137,681.86 $[/tex] dollar (negative)

[tex]$\text{Operating cash flow } = \text{Pre-tax annual operating cost (1-tax rate )} + (\text{depreciation expense} \times $[/tex]tax rate)

[tex]$=79,000(1-0.23)+\left[\left(\frac{360,000}{6}\right) \times 0.23\right]$[/tex]

[tex]$=(-78,000 \times 0.77)+(60,000 \times 0.23)$[/tex]

= -$ 47,030

Year      Annual Cost flow     Present value factor    Present Value of Annual

                                                     at 10%                              cash flow

1                    -47,030                  0.909091                          -42,754.55

2                  -47,030                   0.826446                          -38,867.77

3                   -47,030                  0.751315                           -35,334.34

4                   -47,030                 0.683013                            -32,122.12

5                  -47,030                  0.620921                            -29,201.93

6                  -47,030                 0.564474                            -26,547.21  

    Total                                     $ 4.355261                       $  -204,827.91

Net Present Value = Present Value of annual cash inflows – Initial Investment

[tex]$= 204,827.91 - 360,000$[/tex]

= -$ 564,827.91 (negative)

EAC for system B:

Equivalent Annual Cost for system B [tex]$=\frac{\text{net present value}}{\text{PVIFA 10 \text percent, 6 years}}$[/tex]

[tex]$=\frac{-564,827.91}{4.355261}$[/tex]

= -$129,688.66 (negative)


Related Questions

someone please help me with this problem much appreciated​

Answers

the answer is 5. (B)

Sally went to the clearance rack at a department store and found a shirt she wanted to buy. The shirt was $36.00 and is on sale for $24.00. What is the percent of the decrease?

Answers

Answer:

33.34%.

Step-by-step explanation:

Given that,

The actual price of the shirt = $36

Price on sale = $24

We need to find the percent of the decrease. The formula for the percentage is given by :

[tex]\%=\dfrac{|\text{actual value-estimated value}|}{\text{actual value}}\times 100[/tex]

Putting all the values,

[tex]\%=\dfrac{24-36}{36}\times 100\\\\=33.34\%[/tex]

So, the percentage decrease in the price of the shirt is 33.34%.

how would I go about Simplify 2⁵ ÷ 2³​

Answers

Answer:

2^8

Step-by-step explanation:

A manufacturer wants to construct a box whose base length is 4 times the base width. The material to build the top and bottom cost 8 dollars per ft.2 and sides 5 dollars per ft.2. If the box must have a volume of 72 ft.3, determine the dimensions that will minimize cost.

Answers

Answer:

width = 1.77845 ft

length = 7.1138 ft

height = 5.691 ft

total cost = $759.09

Step-by-step explanation:

volume = length x width x height

length = 4 width

base of the rectangle = 4 x 1 w = 4w²

72 (volume) = 4w²h

18 = w²h

f(c) = (2 x 4w² x $10) + (2 x wh x $5) + (2 x 4wh x $5)

f(c) = 80w² + 10wh + 40wh

f(c) = 80w² + 50wh

since we need only 1 variable (width), we have to substitute h:

h = 18/w²

f(c) = 80w² + 50w(18/w²) = 80w² + 900/w

f'(c) = 160w + 900/w²

0 = (160w³ + 900)/w²

0 = 160w³ + 900

0 = 20(8w³ + 45)

0 = 8w³ + 45

8w³ = -45

w³ = -45/8

w = ∛-45/8 = -1.77845 and 1.77845

since w cannot be negative, then it must be 1.77845

A passenger train has 12 cars with a total of 204 people on it. How many people per car?

Answers

Answer:

17

Step-by-step explanation:

204 / 12 = 17

which ordered pair is a solution to the equation y=3x-10​

Answers

Answer:

(4,2)

As you plug the coordinates into an equation and it equals

(3x4)-2= 12-2 =10

Have a beautiful day! v(⌒o⌒)v♪

Please Help ASAP - 10 Points!

What is the value of f(g) at f(21)?

Answers

Answer:

46.2

Step-by-step explanation:

if you plug the value given for g into g in the equation, it should look like

2.2(21) which you multiply the two together. and you get 46.2.

hope this helps you...sorry just seen  your question now.

PLEASE HELP ME ASAP!!

Answers

the answer would be y= -2/5x +2 :)

Write an equation of a parabola with a vertex at the origin and the focus at (0,3). Please helpppp meeee???!!

Answers

Answer:

y= [tex]\frac{1}{12}[/tex] · x²

Step-by-step explanation:

[tex]\frac{1}{4 times P}[/tex] ·x²

p=3

[tex]\frac{1}{4times3}[/tex] ·x²

What is the value of x in the equation 5(3x + 4) = 23?

start fraction 43 over 15 end fraction
start fraction three over 15 end fraction
start fraction 15 over 43 end fraction
start fraction two over five end fraction

Answers

Answer:

5(3x+4)=23

5*3=15 5*4=20

15x+20=23

      -20=-20

15x=3

divide by 15 from both sides

x=0.2

Step-by-step explanation:

Answer:

5(3x+4)=23

5*3=15 5*4=20

15x+20=23

     -20=-20

15x=3

divide by 15 from both sides

x=0.2

Explanation: In a fraction, the number of equal parts being described is the numerator (from Latin: numerātor, "counter" or "numberer"), and the type or variety of the parts is the denominator (from Latin: dēnōminātor, "thing that names or designates"). As an example, the fraction 8/5

amounts to eight parts, each of which is of the type named "fifth". In terms of division, the numerator corresponds to the dividend, and the denominator corresponds to the divisor.

Informally, the numerator and denominator may be distinguished by placement alone, but in formal contexts they are usually separated by a fraction bar. The fraction bar may be horizontal (as in 1/3), oblique (as in 2/5), or diagonal (as in 4⁄9). These marks are respectively known as the horizontal bar; the virgule, slash (US), or stroke (UK); and the fraction bar, solidus, or fraction slash. In typography, fractions stacked vertically are also known as "en" or "nut fractions", and diagonal ones as "em" or "mutton fractions", based on whether a fraction with a single-digit numerator and denominator occupies the proportion of a narrow en square, or a wider em square. In traditional typefounding, a piece of type bearing a complete fraction (e.g. 1/2) was known as a "case fraction", while those representing only part of fraction were called "piece fractions".

Can some pls help me with one question I will brainlest

Answers

Answer:

whats the question

Step-by-step explanation:

Answer:

Yes

Step-by-step explanation:

whwieiwisijwjdjejeusjsjs

Simplify -8xy + 7xy

is the answer xy?

Answers

-8 + 7 = -1

so the answer would be:

-xy or -1xy

Answer:

-xy

Step-by-step explanation:

Add -8xy and 7xy= -xy

Hope this helped! :)

May i have brainliest!

please hurry

what’s the slope of the line that passes through the points (-5,6) and (11,2)??

Answers

Answer:

-0.25Step-by-step explanation:11 - (-5) is 16 and 2 - 6 is -4 and -4 divided by 16 is -0.25

Answer:

-0.25

Step-by-step explanation:

This is because when calculating the slope of given points, we must use this simple formula:

Slope= rise/run = Δy/Δx

(simplified version)

The actual formula is

slope = (y₂ - y₁) / (x₂ - x₁)PROCESS:

1. Find the difference of the x axis'

ANSWER: The difference of the x axis should be 11-(-5)= 16

2. Find the difference of the y axis'

ANSWER: The difference of the y axis should be 2-(6)= -4

3.  Substitute these new values into the formula Δy/Δx

ANSWER: You should get -4/16 which is -0.25

4. Your answer will be -0.25

you have been saving money to buy a new pair of shoes. Three different stores are having sales on them. Which store has the best deal. Order from lowest price to the highest price.

Original Price $70
Take 10% off
Then take 10% off that price

Original Price $80
Take 15% off
Then take 10% off

Original Price $90
Take 10% off
Then take $25 of

Answers

Answer:

Store 1 has the best deal at $56.70. The order goes as shown below!

Step-by-step explanation:

Store 2 - $61.20

Store 3 - $60.75

Store 1 - $56.70

Hope this helped :)

I’m looking for x can someone help me

Answers

Answer:

x = 30°

Step-by-step explanation:

Since m and n are perpendicular, then

y + 70° = 90° ( subtract 70° from both sides )

y = 20°

thus 40 + y = 40° + 20° = 60°

Then

x + 60° = 90° ( subtract 60° from both sides )

x = 30°

Can someone one at least help me with Part A?

Answers

13x + 42 < 81

X represents the number of cheeseburgers. 42 is the combined grams from the onion rings and shake.
This all combine can be no more than, meaning less than, 81.

Francis is 9 years older than Vincent. Francis is 17 years old. Let v represent how old Vincent is.

Which equation shows an equality between two different ways of expressing how old Francis is?

A. v + 9 = 17
B. v – 9 = 17
C. v x 9 = 17
D.

Answers

Answer: A

Step-by-step explanation:

Francis = v+9

17 = v +9 so A

Answer:

it would be a

9. Consider f(x) = x³+x¹. Would the function be even, odd, neither, or not enough information to determine? A. even B. Odd C. Neither D. Not Enough Information​

Answers

The function is odd, since

f(-x) = (-x)³ + (-x)

… = (-1)³ x³ - x

… = -x³ - x

= -(x³ + x)

… = - f(x)

so the answer is B.

The length of a rectangle is 4 yd less than three times the width, and the area of the rectangle is 55 ya? Find the dimensions of the rectangle. Length: Width : ​

Answers

Answer:

length = 11 yard

width =  5 yard

Step-by-step explanation:

Area of a rectangle = L W

where A = 55 yard

           L = 3W - 4

find: Length

        width

solution:

A = L W

55 = (3W - 4) W

55 = 3W² - 4W

3W² - 4W - 55 = 0

use quadratic equation to solve for W:

W = - (-4) ± √(-4)² - 4(3)-55

                    2(3)

W = 5,  W = -11/3

substitute W=5 to equation L = 3W - 4 to solve for L

L = 3W - 4

L = 3(5) - 4

L = 15 - 4

L = 11

therefore, the dimensions of a rectangle:

length = 11 yard

width =  5 yard

Jared just started a Tennis School. He found an online store selling racquets for $30 each. Write the rule to represent how much Jared spent on a set of racquets for his school.

Answers

(Total amount spent) = 30*(racquets)

Please help me!!
REALLY FAST PLEASE

Answers

Answer:

I would say that the percentage is 2  since

90=100\%(1)

x=95\%(2)

x=85.5

so the answer for this equation is 2% of percentage tax

and will save 85.5

The times for Erin’s five laps around the track were 56.6 seconds, 57.9 seconds, 57.5 seconds, 65.3 seconds, and 65.7 seconds. Using rounding to the nearest whole second as the only estimation technique, what is the total estimated time for Erin’s five laps in seconds?
300
303
304
320

Answers

Answer:

the correct answer should be c, 304

Answer:

c or 304

Step-by-step explanation:

i took the quiz on edge

A rectangle is 12 feet long and 5 feet wide. If the length of the rectangle is increased by 25% and the width is decreased 20%, what is the change in the area of the rectangle?​

Answers

Answer:

36 ft squared

Step-by-step explanation:

12*5=60 Original Size

12+25% of 12= 16

5+ 20% of 5= 6

6*16=96

The difference between the two:

96-60=36 ft squared difference

please help me and pls do both

Answers

Answer:

7/36

Step-by-step explanation:

find the LCD   write all the numerators above the least common denominator

LCD is 36

4 +3 /36 =7/36

Average score in the first 7 tests is 82. How much do you need to score to get an average of 85?

Answers

X+X+X+X+X+X+X/7=82

X+X+X+X+X+X+X+X/8=85

X+X+X+X+X+X+X=574

X+X+X+X+X+X+X+X=680

X=106

You need to score 106

Hope this helps :D

18) If Holstein cows produce milk that is on average 3.66% butterfat and Jersey
cows produce milk that is on average 4.5% butterfat, how many gallons of Jersy milk
should be added to every 100 gal of Holstein milk to have milk that is 4% butterfat?

Guys please help me with this question I’m using all my points for this please just help me

Answers

Answer:

68 gallons

Step-by-step explanation:

Milk of Holstein cows ⇒ 3.66% butterfatMilk of Jersey  cows ⇒ 4.5% butterfat

If we add x gal of 4.5% milk, then we have below equation:

100*0.0366 + x*0.045 = (100 + x)*0.043.66 + 0.045x = 0.04x + 40.045x - 0.04x = 4 - 3.660.005x = 0.34x = 0.34/0.005x = 68 gal

Please at least help me cause I have no idea

Solve for v2
[tex]a \: ave = \frac{v2 - v1}{t2 - t1} [/tex]

Answers

Answer:

Solving the given formula for v2 gives us:

[tex]a(t_2-t_1)+v_1 = v_2[/tex]

Step-by-step explanation:

Solving an equation for a particular variable means that the variable has to be isolated on one side of the equation.

Given equation is:

[tex]a = \frac{v_2-v_1}{t_2-t_1}[/tex]

Multiplying both sides by t2-t1

[tex](t_2-t_1) . a = \frac{v_2-v_1}{t_2-t_1} . (t_2-t_1)\\a(t_2-t_1) = v_2-v_1[/tex]

Adding v1 to both sides of the equation

[tex]a(t_2-t_1)+v_1 = v_2-v_1+v_1\\a(t_2-t_1)+v_1 = v_2[/tex]

Hence,

Solving the given formula for v2 gives us:

[tex]a(t_2-t_1)+v_1 = v_2[/tex]

Question on pictures ^^^^^^^^

Answers

Answer:

y=35 x=145

Step-by-step explanation:

y is equivalent to 35

180-35=145

Answer:

x = 145

y = 35

Step-by-step explanation:

x and the 35 degree angle are supplementary angles, so x + 35 = 180.

solve for x, x = 145. the 35-degree angle and angle Y are corresponding angles, so the value of y will be 35.

Which statement is true about the sign of a quotient? Check all that apply.

A. The quotient of two negative fractions is negative.
B. The quotient of one negative fraction and one positive fraction is negative.
C. The quotient of two positive fractions is negative.
D. The quotient of two positive fractions is positive.
E. The rules for the signs of quotients are the same as the rules for the signs of products.

Answers

Answer:

Step-by-step explanation:

B, D, E

because you have a quotient when you divide and has the same rules as multiplication

94.89 x 3.11 ≈
What is the answer?

Answers

Answer:

295.1079

Step-by-step explanation:

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