J.B. Corporation is considering the purchase of equipment that has an invoice price of 450,000. The equipment
was recommended by a consulting firm that did an analysis for J.B. Corporation. J.B. paid the consulting firm
12,000 for its report.
The cost of shipping and installation is 50,000. The equipment will be depreciated on a
straight-line basis over its useful life of 10 years, assuming no salvage value. The equipment will replace
existing assets that have a current book value of 100,000 and which could be sold for 150,000. Additional net
working capital of 15,000 will be required to maintain the equipment and to support higher sales. J.B.'s
marginal tax rate is 40. Calculate the initial outlay required to fund this project.
Question 2
Both the profitability index (PI) and net present value (NPV) are based on the present value of all
future free cash flows, but the PI is a relative measure while the NPV is an absolute measure of a
project's desirability.
Indicate whether the statement is true or false
This painting depicts New Orleans in 1803, when the city was acquired—along with much of the modern
Alan Price - Poor People
Schematic Diagram of Agitation Apparatus and other equipment (CHE415 Unit Operations)
Capillary puncture equipment.
Real Price of Oil, 1861–2010
Equipment Used During the Physical Assessment