The Luminary Workshop is considering investing in a new 3D printing machine with an expected lifespan of three years. The cost of acquiring this machine is $30,000, and it will be depreciated using the straight-line method over its three-year life until it reaches a residual value of $0.The 3D printing machine is projected to yield 2,000 customized creations in the first year. Sales are expected to increase by 10% annually over the three-year period. The selling price for each customized item will be set at a constant rate of $18. The production cost per item is estimated to be $9.The installation of the new machine and the resulting expansion of production capacity will necessitate adjustments in various net working capital components. It's estimated that the Luminary Workshop should maintain cash equal to 2% of its annual sales, accounts receivable equivalent to 4% of its annual sales, inventory worth 9% of its annual sales, and accounts payable totalling 5% of its annual sales.The firm operates within a 30% tax bracket and has a cost of capital set at 10%.What would be the cash flow you included in the capital budgeting table for the change of NWC adjustment for the second year of the project?

A firm is considering purchasing a massive3D printer to replace the existing one that cost the company $1 million fiveyears ago. The new printer will cost $1.8 million, with an expected salvagevalue of $150,000 in 3 years. The old printer can be sold for of $200,000 todayand or sold for $10,000 in 3 years. What is the initial investment?$1,000,000$1,450,000$1,600,000$1,800,000$2,800,000

A new manufacturing machine is expected to cost $556,000, have an eight-year life, and a $60,000 salvage value. The machine will yield an annual income of $69,916. Annual depreciation expense is $62,000 per year. Compute the accounting rate of return for the investment.

A machine that cost $400,000 has an estimated residual value of $40,000 and an estimated useful life of 20,000 machine hours. The company uses units-of-production depreciation and ran the machine 3,000 hours in year 1, 8,000 hours in year 2, and 6,000 hours in year 3. Required:Calculate its book value at the end of year 3

Multiple Choice QuestionA company purchased manufacturing equipment 5 years ago for $50,000. Book value is currently $5,000 and the remaining useful life is 3 years. The equipment incurs variable manufacturing costs of $30,000. The company is considering replacing the equipment. The new equipment will cost $75,000, have a useful life of 3 years, and is more efficient and, therefore, only costs $10,000 in variable manufacturing costs to operate each year. The vendor is willing to accept the old equipment with a selling price of $20,000. The company should:Multiple choice question.keep the old equipment because the total net increase in income will be $5,000replace the old equipment because the total net increase in income will be $5,000replace the old equipment because the total net decrease in income will be $5,000keep the old equipment because replacing it will decrease income by $5,000 if they purchase the new equipment

Martin Company purchases a machine at the beginning of the year at a cost of $78,000. The machine is depreciated using the straight-line method. The machine’s useful life is estimated to be 5 years with a $4,000 salvage value. The book value of the machine at the end of year 5 is:Multiple Choice$0.$74,000.$14,800.$4,000.$31,200.