Information for two alternative projects involving machinery Investments follows. Project 1 requires an initial Investment of $256,500. Project 2 requires an initial Investment of $174,000. Annual Amounts Sales of new product Expenses Materials, labor, and overhead (except depreciation) Depreciation-Machinery Selling, general, and administrative expenses Income (a) Compute each project's annual net cash flow. (b) Compute payback perlod for each Investment. Required A Required B Complete this question by entering your answers in the tabs below. Compute each project's annual net cash flow. Annual Amounts Sales of new product Expenses Materials, labor, and overhead (except depreciation) Depreciation Machinery Selling, general, and administrative expenses Income Net cash flow $ $ Income Project 1 160,000 Project 1 $ 160,000 80,000 35,000 23,000 22,000 80,000 35,000 23,000 $ 22,000 Cash Flow $ $ Project 2 $ 140,000 47,000 33,000 35,000 $ 25,000 Income Project 2 140,000 47,000 33,000 35,000 25,000 Cash Flow
Information for two alternative projects involving machinery Investments follows. Project 1 requires an initial Investment of $256,500. Project 2 requires an initial Investment of $174,000. Annual Amounts Sales of new product Expenses Materials, labor, and overhead (except depreciation) Depreciation-Machinery Selling, general, and administrative expenses Income (a) Compute each project's annual net cash flow. (b) Compute payback perlod for each Investment. Required A Required B Complete this question by entering your answers in the tabs below. Compute each project's annual net cash flow. Annual Amounts Sales of new product Expenses Materials, labor, and overhead (except depreciation) Depreciation Machinery Selling, general, and administrative expenses Income Net cash flow $ $ Income Project 1 160,000 Project 1 $ 160,000 80,000 35,000 23,000 22,000 80,000 35,000 23,000 $ 22,000 Cash Flow $ $ Project 2 $ 140,000 47,000 33,000 35,000 $ 25,000 Income Project 2 140,000 47,000 33,000 35,000 25,000 Cash Flow
Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
Problem 1PS
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Transcribed Image Text:Information for two alternative projects involving machinery Investments follows. Project 1 requires an initial Investment of $256,500.
Project 2 requires an initial Investment of $174,000.
Annual Amounts
Sales of new product
Expenses
Materials, labor, and overhead (except depreciation)
Depreciation-Machinery
Selling, general, and administrative expenses
Income
(a) Compute each project's annual net cash flow.
(b) Compute payback period for each Investment.
Required A Required B
Compute each project's annual net cash flow.
Complete this question by entering your answers in the tabs below.
Annual Amounts
Sales of new product
Expenses
Materials, labor, and overhead (except depreciation)
Depreciation Machinery
Selling, general, and administrative expenses
Income
Net cash flow
$
$
Income
Project 1
160,000
Project 1
$ 160,000
80,000
35,000
23,000
22,000
80,000
35,000
23,000
$ 22,000
Cash Flow
$
$
Project 2
$ 140,000
47,000
33,000
35,000
$ 25,000
Income
Project 2
140,000
47,000
33,000
35,000
25,000
Cash Flow
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