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Question 1 of 1 -/10 Old Backhoes New Backhoe Purdue cost when new 591.700 5200.20 341.400 554 112 $15.300 $92.000 ya the cache $30.000 $42.700 talow way whether to purchase the new mentor overholdenentant for the old machine the other for the machine subtract the value of the machine to determine the initial In the better worden proses se decimal places and in the factor and the net viser anspreceding the number of purchases 42 Round final decimal 52753 GET OM
-/10 *** New Backhoes Old Backhoes Net Present Value 5 Waterways should equipment 12) Using the wyback method for each choice. (Hint: For the old machine, evaluate the payback of an overhaul (Round answers to 2 decimal places 1.25) New Blackhoes Old Backhoes Payback Period years year Waterways should pent GCF
(3) Comparing the profitability index for each choice. (Round answers to 2 decimal places, es 125) New Backhoes Old Backhoes Profitability Index Waterways should equipment Calculate the internal rate of retum factor for the new and old blackhoes (Round answers to 5 decimal places, eg 527647.) New Backhoes Old Backhoes IRR Factor (4) Comparing the internal rate of return for each choice to the required 6% discount rate 10:00 PM S2022
Calculate the internal rate of return factor for the new and old blackhoes (Round answers to 5 decimal places, es 5.27647) New Backhoes Old Backhoes IRR Factor (4) Comparing the internal rate of return for each choice to the required 8% discount rate Waterways should equipment dTextbook and Media Attempts unlimited Sub 30 00 522
Question 1 of 1 < - / 10 Waterways puts much emphasis on cash flow when it plans for capital investments. The company chose its discount rate of 8%based on the rate of return it must pay its owners and creditors. Using that rate, Waterways then use different methods to determine the best decisions for making capital outlays This year Waterways is considering buying five newbackhoes to replace the backhoes it now has. The new backhoes are faster, cost less to run, provide for more accurate trench digging have comfort features for the operators and have 1 year maintenance agreements to go with them. The old backhoes are working just fine, but they do require considerable maintenance. The backhoe operators are very familiar with the old backhoes and would need to learn some new skills to use the new backhoes The following information is available to use in deciding whether to purchase the new backhoes Old Backhoes New Backhoes Purchase cost when new 591,700 $200,905 Salvage value now $42.400 Investment in major overhaul teeded in next year 554112 Salvage value in 8 years $15.300 592000 Remaining lite years By Net cash flow generated each 530.000 543.700
LLIURE - / 10 = Click here to view PV table (al Evaluate in the following ways whether to purchase the new equipment or overhaul the old equipment. (Hint: For the old machine, the initial investment is the cost of the overhaul. For the new machine, subtract the salvage value of the old machine to determine the initial cost of the investment) (1) Using the net present value method for buying new or keeping the old, (For calculation purposes, use 5 decimal places as displayed in the factor table provided. If the net present value is negative, use either a negative sign preceding the number eg -45 or parentheses es (45) Round final answer to decimal places, es 5,275) New Backhoes Old Backhoes Net Present Value Waterways should equipment (2) Using the paybackmethod for each choice. tiet For the old machine, evaluate the payback of an overhaul (Round answers to 2
Question 1 of 1 -/10 E 1 [2Using the payback method for each choice. Hint. For the old machine evaluate the payback of an overhaul) (Round answers to 2 decimal places 1.25) New Backhoes Old Backhoes Payback Period years Yes Waterways should equipment tay comparing the profitability index for each choice:Round answers to 2 decimal places, e 125) New Backhoes Old Backhoes Profitability Index
Question 1 of 1 -/10 Waterways should equipment Calculate the internal rate of return factor for the new and old blackhoes. (Round answers to decimal places.es. 5.27647.) 5 New Backhoes Old Backhoes IRR Factor (4) Comparing the internal rate of return for each choice to the required 8% discount rate Waterways should equipment eTextbook and Media