Attempts Rome a Caspian Sea Drinks is considering the purchase of a plum juicer -...
70.2K
Verified Solution
Link Copied!
Question
Finance
Attempts Rome a Caspian Sea Drinks is considering the purchase of a plum juicer - the PJXS. There is no planned increase in production The PJXS will reduce costs by squeezing more juice from each plum and doing so in a more efficient manner. Mr. Bensen gave Derek the following information. What is the NPV of the PJX5? a. The PJXs will cost $1.81 million fully installed and has a 10 year life. It will be depreciated to a book value of $155,275.00 and sold for that amount in year 10. b. The Engineering Department spent $40,432.00 researching the various juicers. c. Portions of the plant floor have been redesigned to accommodate the juicer at a cost of $21.278.00. d. The PuXs will reduce operating costs by S454,203.00 per year. 6. CSD's marginal tax rate is 29.00% 1. CSD is 61.00% equity-financed. g. CSD's 11.00-year, semi-annual pay, 5.55% coupon bond sells for $1,047.00 h. CSD's stock currently has a market value of $24.91 and Mr. Bensen believes the market estimates that dividends will grow at 3.68% forever. Next year's dividend is projected to be $1.67. Submit Answer format: Currency: Round to: 2 decimal Places
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!
