A Digital Assembly System That Costs $160,000 Is Expected to Operate

question 91

Multiple Choice

A digital assembly system that costs $160,000 is expected to operate for 8 years. The estimated salvage value at the end of 8 years is $12,000. The system is expected to save the company $38,000 in labor costs before taxes and depreciation. The company will depreciate this system on a 5-year MACRS schedule. If the firm's cost of capital is 12% and its marginal tax rate is 35%, compute the NPV for the project. (Note: Requires MACRS tables.)

• A) $4,045
• B) $7,196
• C) $20,873
• D) $167,196

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Definitions:

Read-only

A file attribute or access permission that allows content to be viewed or read, but not modified.

Encrypted

Pertains to data that has been converted into a code or cipher to prevent unauthorized access, ensuring that only those with the decryption key can read it.

Slide Timings

Slide Timings are predetermined durations set for individual slides in a presentation to control how long each slide appears during a slideshow.

Manual Advancement

The process of moving or progressing through something step-by-step or stage-by-stage, often referring to a manual or non-automated mechanism.