Becker Billing Systems, Inc., has an antiquated high-capacity printer that needs to be upgraded. The system either can be overhauled or replaced with a new system. The following data have been gathered concerning these two alternatives (Ignore income taxes.): Overhaul Present SystemPurchase New SystemPurchase cost when new$300,000 $400,000 Accumulated depreciation$220,000 - Overhaul costs needed now$250,000 - Annual cash operating costs$120,000 $90,000 Salvage value now$90,000 - Salvage value in ten years$30,000 $80,000 Working capital required - $50,000 See separate Exhibit 13B-1 and Exhibit 13B-2, to determine the appropriate discount factor(s) using the tables provided.The company uses a 10% discount rate and the total-cost approach to capital budgeting analysis.
The working capital required under the new system would be released for use elsewhere at the conclusion of the project. Both alternatives are expected to have a useful life of ten years.The net present value of the new system alternative is closest to:
A. $(758,400)
B. $(862,900)
C. $(552,900)
D. $(987,400)
Answer: B
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a. differ between individuals and are relatively stable over time b. do not differ between individuals and are relatively stable over time c. differ between individuals and are very unstable d. do not differ between individuals and are very unstable
The vertical analysis statement of Bateman, Inc is as shown below
Bateman, Inc Comparative Income Statement Years Ended December 31, 2017 and 2016 (In millions) 2017 Percent of Total 2016 Percent of Total Net Sales $6,355 100.0% $4,920 100.0% Cost of Goods Sold 3,370 53.0 2,200 44.7 Gross Profit 2,985 47.0 2,720 55.3 Operating Expenses: Selling Expenses 675 10.6 580 11.8 Administrative expenses 410 6.5 425 8.6 Total Operating Expenses 1,085 17.1 1,005 20.4 Operating Income 1,900 29.9 1,715 34.9 Other Revenues and (Expenses): Interest Revenue 0 0 0 0.0 Interest Expense (400 ) (6.3 ) (695 ) (14.1 ) Total Revenues and (Expenses) (400 ) (6.3 ) (695 ) (14.1 ) Income Before Income Taxes 1,500 23.6 1,020 20.7 Income Tax Expense 230 3.6 210 4.3 Net Income $1,270 20.0% $810 16.5% The figure 47.0% shown for gross profit in 2017 signifies that the gross profit is ________. A) equal to 47.0% of net income B) increased by 47.0% over the previous year C) 47.0% of net sales revenue D) 47.0% of cost of goods sold
The Drug-Free Workplace Act of 1988 requires ________ to establish written drug-free workplace policies and establish drug-free awareness programs
a. government contractors b. federal administrators c. state judicial officers d. labor inspectors
The _________ takes an application message to be transmitted, fragments the data into manageable blocks, optionally compresses the data, applies a MAC, encrypts, adds a header, and transmits the resulting unit in a TCP segment
What will be an ideal response?