Clark Paints

Data: comprise of unsanded equipment 200,000 Expected life of equipment5 governance value in 5 years 40,000 livelihood doing - follow of cans 5,500,000 yearly production or procure needs 1,100,000 sub due(p) of workers needed 3 yearbook hours to be worked per employee 2,000 Earnings per hour for employees 12.00 annual health benefits per employee 2,500 tonic(prenominal) yearbook benefits per employee - % of wages18% speak to of raw materials per can0.25 opposite multivariate production greets per can0.05 be to corrupt cans - per can0.45 Required enjoin of return12% valuate revenue rate35% Cost to produce:Make leveraging annual cost of direct materials: train of 1,100,000 cans per year 330,000 yearbook cost of direct labor for new employees Wages 72,000 wellness Benefits 7,500 Other Benefits 12,960 sum wages and benefits 92,460 direct along annual production be 422,460 yearly cost to purchase cans 495,000 Part 1: cash fertilizes over the life of the project onwards valuateTax Effect afterward Tax Item Annual cash nest egg (make vs buy) 72,540 0.

65 47,151 Tax savings due to wear and tear 32,000 0.35 11,200 Total annual cash flow 58,351 Part 2: payback period $200,000 / $58,3513.4years Part 3: Annual rate of return Accounting income as result of fall costs Annual cash savings (before tax effect) 72,540 slight Depreciation (32,000) in front tax income 40,540 Tax at 35% rate (14,189) After tax Income 26,351 $26,351 / $200,00013.18% Part 4: electronic network parade ValueBefore taxAfter tax12% PVPresent ItemYearamountTax % stepFactorValue Cost of Machine0...If you want to get a full essay, determine it on our website: Ordercustompaper.com

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