Lakeside Incorporated is considering replacing old production equipment with state-of-the-art technology that will allow production...
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Lakeside Incorporated is considering replacing old production equipment with state-of-the-art technology that will allow production cost savings of $10,000 per month. The new equipment will have a five-year life and cost $450,000, with an estimated salvage value of $40,000. Lakesides cost of capital is 8%. Table 6-4 and Table 6-5.
Required:
Calculate the net present value of the new production equipment.
Note: Use appropriate factor(s) from the tables provided. Round the PV factors to 4 decimals. Round your final answer to nearest whole dollars.
Lakeside Incorporated is considering replacing old production equipment with state-of-the-art technology that will allow production cost savings of $10,000 per month. The new equipment will have a five-year life and cost $450,000, with an estimated salvage value of $40,000. Lakeside's cost of capltal is 8%. and Table 6-5. Required: Calculate the net present value of the new production equipment. Note: Use approprlate factor(s) from the tables provided. Round the PV factors to 4 decimals. Round your flnal answer to nearest whole dollars. Table 6-4: Factors for Calculating the Present Value of $1 Table 6-5: Factors for Calculating the Present Value of an Annuity of $1
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