The Logan Publishing Corporation Is Contemplating the Acquisition of a State

question 83

Essay

The Logan Publishing Corporation is contemplating the acquisition of a state of the art printing press.The following information is relevant:
The cost of the printing press is $\$ 180,000$
The anticipated revenue from the printing press is $\$ 120,000$ per year. The useful life of the car washis 12 years.
Anmul operating costs are expected to be:

$\begin{array}{ll}\text { Salaries } &\$ 40,000 \\\text {Utilities } & 10,000 \\\text { Power usage } &4,600\\\text { Supplies } & 6,400\\\text { Repars/maintenance} &12,000\\\end{array}$

The firm uses straight-line depreciation
The salvage value for the car wash is zero.
The company's cutdf points are as follows:
\begin{array}{ll}\text { Payback } &4years \\\text {Accounting rate of return } & 16 \% \\\\text { Internal rate of retune } &16\%\\\\end{array}
Ignore income taxes.
Required:
a. $\text { Compute the annual cash inflow }$
b. $\text { Compute the net present value }$
c. $\text { Compute internal rate of retun }$
d. $\text { Compute the payback period }$
e. $\text { Compute the profitability index }$
f. $\text { Should the printing press be purchased. }$

Understand the distinction between informational and normative social influences.

Grasp the concept of group norms and how they are established.

Recognize how group size and presence of dissenting voices impact conformity.

Identify and understand various social influence techniques such as the low-ball technique and the foot-in-the-door technique.

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Definitions:

Sales Uncollected

Refers to revenue from sales for which payment has not yet been received; also known as accounts receivable.

Liquidity

The ability of a company or individual to quickly convert assets into cash without significant loss in value, essential for meeting short-term obligations.

Accounts Receivable

Funds due to a company from its clients for products or services that have already been provided but remain unpaid.

Net Sales

The total revenue a company generates from its sales activities after subtracting returns, allowances, and discounts.