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1. Cury Industries is deciding whether to automate one phase of its production prooess. The manufacturing equipment has a sb-year life and will cost $825,000. Projected net cash inflows are as follows: (Click the icon to view the projected net cash inflows.) (Click the icon to view Present Value of $1 table.) (Click the icon to view Present Value of Ordinary Annuity of $1 table.) Read the requirements Requirement 1. Compute this project's NPV using Cury's 14% hurdle rate. Should Cury invest in the equipment? Use the following table to calculate the net present value of the project. (Enter any factor amounts to three decimal places, Xxx Use parentheses or a minus sign for a negative net present value.) Net Cash PV Factor Present Years Inflow 11 -14%) Value Present value of each year's inflow in = 1) in 2) 3 (n = 3) (n 4) 5 1 2 6 Total PV of cash inflows Initial investment 0 Net present value of the project Enter any number in the edit fields and then continue to the next question
Test: Lesson 13 Homework This Question: 10 pts 5 of complete This Test 50 ps possible 1 st Help Cury Industries is decide whether to worrate one phase of the production process. The management parite and will cost $28.000. Projected rechinows are now Im Click the loon to view the projected net cash Wow) Click the lion to view Present we of State) COM The icon to view Pre We of Ordinary Aruty of the Read the ramen Investment Nel present value of the project Cury Industries Requirement 2. Cury could refurbish the agent at the end of six years for $10.000. The refurbished more could be used one more your providing 72.000 of net cashews in your doorly, there would hawa 552,000 residual value at the end of yew 7. Show Guy invest in the event and refurbisher years oint in addition to your answer toegement decor the font chaufwand Wows back to the present .0 wala) Calculate the NPV of the refurbishment (Enter any factor mounts to the decimal placesXXXX. Uw para minus wigs for cash outlows and for a negativne presentar Cash PV Factor ( foutflowinflow Refurbishment at the end of Year 6 in ) Cashindows in Your 7 (7) Residual in Nel present value of the relishment The refurbishment provides NPV. The refurbishment NPV to overcome theangal NPV at the equipment. Therefore, the return Water Cury Industrie onginal decision regarding the Enter any number in the edit fields and then continue to the next question
his Question: 10 pts Dury Industries is deciding whether to automate one phase of its production process. The manufacturing equipment has a six-year life and will cost $925,000. Projecto Click the icon to view the projected net cash inflows.) Click the icon to view Present Value of $1 table.) (Click the icon to view Present Value of Ordinary Annuity of $1 table.) Read the requirements 0 Data Table a minus sign for Requirement 1. Compute this project's NPV using Cury's 14% hurdle rate. Should Cury invest Use the following table to calculate the net present value of the project. (Enter any factor amour Net Cash PV Factor Preser Years Inflow (i = 14%) Value Present value of each year's inflow: 261,000 Year 1 $ Year 2 Year 3 1 250,000 222,000 210,000 2. Year 4 3 200,000 (n=2) (n3) In 4) (n = 5) (n = 6) Total PV of cash inflows Year 5 Year 6 173,000 5 6 Print Done 0 Initial investment Net present value of the project Enter any number in the edit fields.

2. Due to erratic sales of its sole product-a high-capacity battery for laptop computers—PEM, Inc., has been experiencing financial difficulty for some time. The company's contribution format income statement for the most recent month is given below: Sales (12,600 units x $30 per unit) Variable expenses Contribution margin Fixed expenses Net operating loss $ 378,000 189,000 189,000 211,500 $ (22,500) Required: 1. Compute the company's CM ratio and its break-even point in unit sales and dollar sales. 2. The president believes that a $6,600 increase in the monthly advertising budget, combined with an intensified effort by the sales staff, will result in an $87,000 increase in monthly sales. If the president is right, what will be the increase (decrease) in the company's monthly net operating income? 3. Refer to the original data. The sales manager is convinced that a 10% reduction in the selling price, combined with an increase of $38,000 in the monthly advertising budget, will double unit sales. If the sales manager is right, what will be the revised net operating income (loss)? 4. Refer to the original data. The Marketing Department thinks that a fancy new package for the laptop computer battery would grow sales. The new package would increase packaging costs by $0.80 per unit. Assuming no other changes, how many units would have to be sold each month to attain a target profit of $4,300? 5. Refer to the original data. By automating, the company could reduce variable expenses by $3 per unit. However, fixed expenses would increase by $54,000 each month. a. Compute the new CM ratio and the new break-even point in unit sales and dollar sales. b. Assume that the company expects to sell 20,600 units next month. Prepare two contribution format income statements, one assuming that operations are not automated and one assuming that they are. (Show data on a per unit and percentage basis, as well as in total, for each alternative.) c. Would you recommend that the company automate its operations (Assuming that the company expects to sell 20,600)?
Complete this question by entering your answers in the tabs below. Reg 1 Reg 2 Req3 Reg 4 Req 5A Reg 5B Req 5C Compute the company's CM ratio and its break-even point in unit sales and dollar sales. ((Do not round intermediate calculations. Round "CM ratio" to the nearest whole percentage (i.e., 0.234 should be entered as "23").) CM ratio 501 % Break-even point in unit sales Break-even point in dollar sales
Complete this question by entering your answers in the tabs below. Reg 1 Reg 2 Req3 Reg 4 Reg 5A Reg 5B Reg 5C The president believes that a $6,600 increase in the monthly advertising budget, combined with an intensified effort by the sales staff, will result in an $87,000 increase in monthly sales. If the president is right, what will be the increase (decrease) in the company's monthly net operating income? (Do not round intermediate calculations.). by
Complete this question by entering your answers in the tabs below. Reg 1 Reg 2 Reg 3 Reg 4 Reg 5A Reg 5B Reg 5C Refer to the original data. The sales manager is convinced that a 10% reduction in the selling price, combined with an increase of $38,000 in the monthly advertising budget, will double unit sales. If the sales manager is right, what will be the revised net operating income (loss)? (Losses should be entered as a negative value.). Revised net operating income (loss)
Complete this question by entering your answers in the tabs below. Req 1 Reg 2 Req3 Req 4 Req 5A Reg 5B Reg 5C Refer to the original data. The Marketing Department thinks that a fancy new package for the laptop computer battery would grow sales. The new package would increase packaging costs by $0.80 per unit. Assuming no other changes, how many units would have to be sold each month to attain a target profit of $4,300? (Do not round intermediate calculations. Round final answer to the nearest whole unit.) Show less Unit sales to attain target profit
Complete this question by entering your answers in the tabs below. Req 1 Req 2 Req3 Reg 4 Reg 5A Reg 5B Reg 5C Refer to the original data. By automating, the company could reduce variable expenses by $3 per unit. However, fixed expenses would increase by $54,000 each month. Compute the new CM ratio and the new break-even point in unit sales and dollar sales. (Do not round intermediate calculations. Round "CM ratio" to the nearest whole percentage (i.e., 0.234 should be entered as "23") and other answers to the nearest whole number.) Show less CM ratio Break-even point in unit sales Break-even point in dollar sales
Complete this question by entering your answers in the tabs below. Req 1 Req 2 Req3 Req 4 Req 5A Reg 5B Reg 5C Refer to the original data. By automating, the company could reduce variable expenses by $3 per unit. However, fixed expenses would increase by $54,000 each month. Assume that the company expects to sell 20,600 units next month. Prepare two contribution format income statements, one assuming that operations are not automated and one assuming that they are. (Show data on a per unit and percentage basis, as well as in total, for each alternative.) (Do not round your intermediate calculations. Round your percentage answers to the nearest whole number.) : Show less A PEM, Inc. Contribution Income Statement Not Automated Total Per Unit % Automated Per Unit Total % % % % 0 % % 0 % 0 $ 0 0 $ 0 $ 0 $ 0