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Blaylock Company wants to buy a numerically controlled NC machine to be used in producing specially machined parts for manufacturers of tractors The outlay required is $384000 The NC equipment

Blaylock Company wants to buy a numerically controlled (NC) machine to be used in producing specially machined parts for manufacturers of tractors. The outlay required is $384,000. The NC equipment will last 5 years with no expected salvage value. The expected after-tax cash flows associated with the project follow: Year Cash Revenues Cash Expenses 1.....................$510,000.............................$360,000 2.......................510,000..............................360,000 3.......................510,000..............................360,000 4.......................510,000..............................360,000 5.......................510,000..............................360,000 Required: 1. Compute the payback period for the NC equipment. 2. Compute the NC equipment s ARR. Round the percentage to one decimal place. 3. Compute the investment s NPV, assuming a required rate of return of 10%. 4. Compute the investment s IRR.

Jun 25 2020 View more View Less

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