Based on the above computed results, justify TWO (2) reasons why the company should purchase...

60.1K

Verified Solution

Question

Finance

image

Based on the above computed results, justify TWO (2) reasons why the company should purchase that model

LalaDel Company is considering two models of the new assembly machines that should produce considerable cost savings in its assembly line. The cost of each machine model is RM14,000, and there is no salvage value at the end of a 4-year useful life. The company's required rate of return is at 12% and the company prefers that a project return its initial outlay within the first half of the project's life. The annual after-tax cash savings for each machine are provided in the following table. LalaDel Company is considering two models of the new assembly machines that should produce considerable cost savings in its assembly line. The cost of each machine model is RM14,000, and there is no salvage value at the end of a 4-year useful life. The company's required rate of return is at 12% and the company prefers that a project return its initial outlay within the first half of the project's life. The annual after-tax cash savings for each machine are provided in the following table

Answer & Explanation Solved by verified expert
Get Answers to Unlimited Questions

Join us to gain access to millions of questions and expert answers. Enjoy exclusive benefits tailored just for you!

Membership Benefits:
  • Unlimited Question Access with detailed Answers
  • Zin AI - 3 Million Words
  • 10 Dall-E 3 Images
  • 20 Plot Generations
  • Conversation with Dialogue Memory
  • No Ads, Ever!
  • Access to Our Best AI Platform: Flex AI - Your personal assistant for all your inquiries!
Become a Member

Other questions asked by students