Use the Information Below to Answer the Following Question(s)

question 25

Multiple Choice

Use the information below to answer the following question(s) .Hawkeye Cleaners has been considering the purchase of an industrial dry-cleaning machine.The existing machine is operable for three more years and will have a zero disposal price.If the machine is disposed of now, it may be sold for $30,000.The new machine will cost $200,000, an additional cash investment in working capital of $60,000 will be required and will be returned at the end of the project.The machine is expected to last 3 years and has an estimated disposal value at that time of $20,000.The new machine will reduce the average amount of time required to wash clothing and will decrease labour costs.The investment is expected to net $50,000 in additional cash inflows during the year of acquisition and $150,000 each additional year of use.These cash flows will generally occur throughout the year and are recognized at the end of each year.Income taxes are not considered in this problem.
-Which of the following results of net present value analyses is the LEAST acceptable?

• A)$(15,000)
• B)$(1,000)
• C)$12,000
• D)$0
• E)$20,000

Grasp the significance of corporate responsibility in balancing profit, consumer satisfaction, and societal well-being.

Recognize the legal frameworks, including Sarbanes-Oxley Act, aimed at combating unethical practices in corporations.

Understand the concept and implications of whistle-blowing in the business context.

Recognize the importance of ethical corporate considerations beyond profit.

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Definitions:

Direct Write-off Method

A method of accounting for bad debts that involves charging unpaid invoices directly to the expense account when they are determined to be uncollectible.

Allowance Method

An accounting technique used to estimate uncollectible accounts receivable and record them as an expense.

Bad Debts

Money owed to a company that is considered irrecoverable and is written off as a loss.

Outstanding Balances

The total amount of money owed that has not yet been paid.