Aria Acoustics, Inc. (AAI), projects unit sales for a new seven-octave voice emulation implant as follows: |
Year | Unit Sales | |||
1 | 74,800 | |||
2 | 87,800 | |||
3 | 107,250 | |||
4 | 99,700 | |||
5 | 68,200 | |||
Production of the implants will require $1,950,000 in net working capital to start and additional net working capital investments each year equal to 20 percent of the projected sales increase for the following year. Total fixed costs are $4,100,000 per year, variable production costs are $264 per unit, and the units are priced at $402 each. The equipment needed to begin production has an installed cost of $18,300,000. Because the implants are intended for professional singers, this equipment is considered industrial machinery and thus qualifies as seven-year MACRS property. In five years, this equipment can be sold for about 25 percent of its acquisition cost. The tax rate is 24 percent the required return is 15 percent. MACRS schedule |
a. | What is the NPV of the project? (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.) |
b. | What is the IRR? (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.) |
NPV=
IRR=
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Please show the steps and which answer is NPV and IRR Thank you! Problem 10-36 Project Evaluation (LO1) Aria Acoustics, Inc. (AAI), projects unit sales for a new seven-octave voice emulation implant as follows: Year 10 points Unit Sales 73,800 86,800 106,000 98,200 67,700 8 02:17:26 Mtu Production of the implants will require $1,700,000 in net working capital to start and additional net working capital investments each year equal to 10 percent of the projected sales increase for the following...
Aria Acoustics, Inc. (AAI), projects unit sales for a new seven-octave voice emulation implant as follows: Year AM Unit Sales 78,000 91,000 105,000 100,000 81,000 Production of the implants will require $1,570,000 in net working capital to start and additional net working capital investments each year equal to 10 percent of the projected sales increase for the following year. Total fixed costs are $1,470,000 per year, variable production costs are $250 per unit, and the units are priced at $365...
Aria Acoustics, Inc. (AAI), projects unit sales for a new seven-octave voice emulation implant as follows: Year Unit Sales 1 72,000 2 85,000 3 99,000 4 94,000 5 75,000 Production of the implants will require $1,510,000 in net working capital to start and additional net working capital investments each year equal to 10 percent of the projected sales increase for the following year. Total fixed costs are $1,410,000 per year, variable production costs are $220 per unit, and the units...
Aria Acoustics, Inc. (AAI), projects unit sales for a new seven-octave voice emulation implant as follows: Year NM Unit Sales 73,800 86,800 106,000 98,200 67,700 Production of the implants will require $1,700,000 in net working capital to start and additional networking capital investments each year equal to 10 percent of the projected sales increase for the following year. Total fixed costs are $3,600,000 per year, variable production costs are $259 per unit, and the units are priced at $387 each....
Problem 10-36 Project Evaluation (L01] Aria Acoustics, Inc. (AAI), projects unit sales for a new seven-octave voice emulation implant as follows: Year points Skipped Unit Sales 73,400 86,400 105,500 97,600 67,500 Production of the implants will require $1,600,000 in net working capital to start and additional net working capital investments each year equal to 15 percent of the projected sales increase for the following year. Total fixed costs are $3,400,000 per year, variable production costs are $257 per unit, and...
Aria Acoustics, Inc. (AAI), projects unit sales for a new seven-octave voice emulation implant as follows Year 2 4 Unit Sales 73,000 86,000 105,000 97,000 67,000 5 Production of the implants will require $1,500,000 in net working capital to start and additional net working capital investments each year equal to 15 percent of the projected sales increase for the following year. Total fixed costs are $3,200,000 per year, variable production costs are $255 per unit, and the units are priced...
Aria Acoustics, Inc. (AAI), projects unit sales for a new seven-octave voice emulation implant as follows: Year Unit Sales 1 75,000 2 88,000 3 107,500 4 100,000 5 68,300 Production of the implants will require $2,000,000 in net working capital to start and additional networking capital investments each year equal to 10 percent of the projected sales increase for the following year. Total fixed costs are $4,200,000 per year, variable production costs are $265 per unit, and the units are...
Aria Acoustics, Inc. (AAI), projects unit sales for a new seven-octave voice emulation implant as follows: Year WN Unit Sales 71,500 87.800 104,300 89,200 75,300 Production of the implants will require $1.5 million in net working capital to start and additional net working capital investments each year equal to 15 percent of the projected sales increase for the following year. Total fixed costs are $2.15 million per year, variable production costs are $230 per unit, and the units are priced...
Aria Acoustics inc projects unit sales for a new seven octave voice emulation implant as follows: year 1 74,000 2 87,000 Aria Acoustics, Inc. (AA, projects unit sales for a new seven-octave voice emulation mplant as folows 74,000 87000 3 106 250 98,500 67.800 Production of the implants will require $1750,000 in net working capital to start and additional net working capital investments each year equal to 15 percent of the projected sales increase for the following year Total fixed...
Aria Acoustics, Inc. (AAI), projects unit sales for a new seven-octave voice emulation implant as follows: Year Unit Sales 1 73,000 2 86,000 3 105,000 4 97,000 5 67,000 Production of the implants will require $1,500,000 in net working capital to start and additional net working capital investments each year equal to 15 percent of the projected sales increase for the following year. Total fixed costs are $3,200,000 per year, variable production costs are $255 per unit, and the units...