Pharoah Corp. is considering purchasing one of two new diagnostic machines. Either machine would make...
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Pharoah Corp. is considering purchasing one of two new diagnostic machines. Either machine would make it possible for the company to bid on jobs that it currently isn't equipped to do. Estimates regarding each machine are provided here. Original cost Estimated life Salvage value Estimated annual cash inflows Estimated annual cash outflows Machine A $74,600 8 years 0 $20,000 $5,170 Machine B $182,000 8 years 0 $40,200 $10,190
Pharoah Corp. is considering purchasing one of two new diagnostic machines. Either machine would make it possible for the company to bid onjobs that it currently isn't equipped to do. Estimates regarding each machine are provided here. Clicklyere to view the factor table. Calculate the net present value and profitability index of each machine. Assume a 9 discount rate. (if the net present value is negative. use either a negative sign preceding the number es 45 or parentheses eg (45). Round answer for present value to 0 decimal places, eg. 125 and profitabality index to 2 decimal pleces, eg. 10.50. For calaulation purposes, use 5 decinal places as disployed in the factar table provided
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