| Extra cost of Machine B = 51,000-48,000 = $3000 | ||
| Year | Incremental Cash flows | Cumulative Cash flows |
| 0 | -3000 | -3000 |
| 1 | -1000 | -4000 |
| 2 | 4000 | 0 |
| 3 | 5000 | 5000 |
| 4 | 5000 | 10000 |
| 5 | 3000 | 13000 |
| 6 | 3000 | 16000 |
| 7 | 2000 | 18000 |
| Hence, payback period = 2 years | ||
| i.e. A | ||
pe company must replace one of its current machines with either Machine A or Machine B. The useful life of both mac...
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X Company must replace one of its current machines with either Machine A or Machine B. The useful life of both machines is seven years. Machine A costs $50,000, and Machine B costs $58,000. Estimated annual cash flows with the two machines are as follows: Year von AWN- Machine A $-6,000 -8,000 -8,000 -8,000 -6,000 -5,000 -4,000 Machine B $-7,000 -4,000 -3,000 -3,000 -3,000 -2,000 -2,000 If X Company buys Machine B instead of Machine A, what is the payback...
8 pt X Comnpany must replace one of its current machines with either Machine A or Machine B. The useful life of both machines is seven years. Machine A costs $48,000, and Machine B costs $67,000. Estimated annual cash flows with the two machines are as follows: Machine B Machine A Year $-7,000 S-6,000 -8,000 -8,000 -8,000 -6,000 -5,000 -4,000 1 -4,000 -3,000 3 -3,000 -3,000 -2,000 -2,000 4 6 7 If X Company buys MachineB instead of Machine A,...
X Company must replace one of its current machines with either Machine A or Machine B. The useful life of both machines is seven years. Machine A costs $52,000, and Machine B costs $60,000. Estimated annual cash flows with the two machines are as follows: Year NM Machine A $ 6,000 8,000 8,000 8,000 6,000 5,000 4,000 Machine B $ 7,000 4,000 3,000 3,000 3,000 2,000 2,000 N If X Company buys Machine B instead of Machine A, what is...
X Company must replace one of its current machines with either
Machine A or Machine B. The useful life of both machines is seven
years. Machine A costs $51,000, and Machine B costs $70,000.
Estimated annual cash flows with the two machines are as
follows:
Year
Machine A
Machine B
1
$-6,000
$-7,000
2
-8,000
-4,000
3
-8,000
-3,000
4
-8,000
-3,000
5
-6,000
-3,000
6
-5,000
-2,000
7
-4,000
-2,000
If X Company buys Machine B instead of Machine...
PE Company must replace one of its current machines with either Machine A or Machine B. The useful life of both machines is seven years. Machine A costs $48.000, and Machine B costs $51.000. Estimated annual cash flows with the two machines are as follows: Year Machine A Machine B S-6,000 $-7,000 -4,000 -8,000 -3,000 -8.000 -3,000 -6,000 -3,000 -5,000 -2,000 -4,000 -2,000 -8.000 If X Company buys Machine B instead of Machine A, what is the payback period in...
X Company must replace one of its current machines with either Machine A or Machine B. The useful life of both machines is seven years. Machine A costs $51,000, and Machine B costs $67,000. Estimated annual cash flows with the two machines are as follows: Year Machine A $-6,000 -8,000 -8,000 -8,000 -6,000 -5,000 -4,000 Machine B $-7,000 -4,000 -3,000 -3,000 -3,000 -2,000 -2,000 If X Company buys Machine B instead of Machine A, what is the payback period (in...
X Company must replace one of its current machines with either Machine A or Machine B. The useful life of both machines is seven years. Machine A costs $49,000, and Machine B costs $68,000. Estimated annual cash flows with the two machines are as follows: Year Machine A $-6,000 -8,000 -8,000 -8,000 -6,000 -5,000 -4,000 Machine B $-7,000 -4,000 -3,000 -3,000 -3,000 -2,000 -2,000 If X Company buys Machine B instead of Machine A, what is the payback period (in...