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In: Finance
A new machine cost $47,000. The machine will be depreciated on a straight-line basis over 5...
A new machine cost $47,000. The machine will be depreciated on a straight-line basis over 5 years to a salvage value of $1,000. The machine will be sold 5 years from now for $15,000. The machine will provide 11,000 per year in savings for 5 years and will require net working capital investment of $1,000. The tax rate is 12% and the discount rate is 12%. Find the NPV of the project. Round your answer to the nearest dollar.
Solutions
jeff jeffy answered 1 year agoRelated Solutions
A new machine cost $44,000. The machine will be depreciated on a straight-line basis over 5...
A new machine cost $44,000. The machine will be depreciated on a
straight-line basis over 5 years to a salvage value of $2,000. The
machine will be sold 4 years from now for $23,000. If the tax rate
is 18%, what is the after-tax gain on the sale of the machine?
Round your answer to the nearest dollar.
A new machine cost $45,000. The machine will be depreciated on a straight-line basis over 5...
A new machine cost $45,000. The machine will be depreciated on a
straight-line basis over 5 years to a salvage value of $1,000. The
machine will be sold 5 years from now for $16,000. The machine will
provide 11,000 per year in savings for 5 years and will require net
working capital investment of $2,000. The tax rate is 12% and the
discount rate is 12%. Find the NPV of the project. Round your
answer to the nearest dollar.
ASAP...
The new equipment will cost $7,500. And it would be depreciated on a straight-line basis over...
The new equipment will cost $7,500. And it would be depreciated
on a straight-line basis over the project's 5-year life
(depreciation rate is 20% per year) and would require additional
$200 net operating working capital that would be recovered at the
end of the project's life. There is no salvage value.
After purchasing this equipment, firm could sell 1000 products
per year at $6 per one. And operating costs is 50% of sale revenue.
Tax rate is 40% and Weighted...
The new equipment will cost $400,000. It would be depreciated to zero using straight-line depreciation over...
The new equipment will cost $400,000. It would be depreciated to
zero using straight-line depreciation over a 5-year period. The
estimated salvage value is $100,000 at the end of the project. The
initial requirement in net working capital is $55,000, all of which
will be recouped at the end of the project. The projected operating
cash flows are $155,500 per year. The tax rate is 30%. What is the
internal rate of return on this 5-year project? Group of answer...
Daily Enterprises is purchasing a $14,000,000 machine. The machine will be depreciated using straight-line depreciation over...
Daily Enterprises is purchasing a $14,000,000 machine. The
machine will be depreciated using straight-line depreciation over
its 10 year life and will have no salvage value. The machine will
generate revenues of $7,500,000 per year along with fixed costs of
$2,000,000 per year.
(please show steps)
If Daily's marginal tax rate is 28%, what will be the cash flow
in each of years 1 to 10 (the cash flow will be the same each
year)?
If the discount rate is...
Your firm needs a $725,000 machine. If purchased, the machine will be depreciated straight-line over seven...
Your firm needs a $725,000 machine. If purchased, the machine
will be depreciated straight-line over seven years and is expected
to have a residual value of $25,000 at the end of the seventh year.
Your (pre-tax) cost of borrowing is 6.5% and tax rate is 21%. If
this is a non-tax lease, with beginning of year payments, what is
the maximum lease payment for which you would prefer the lease to
the alternative of borrowing money to buy the machine?
Daily Enterprises is purchasing a $10,000,000 machine. The machine will be depreciated using straight-line depreciation over...
Daily Enterprises is purchasing a $10,000,000 machine. The
machine will be depreciated using straight-line depreciation over
its 8 year life and will have no salvage value. The machine will
generate revenues of $7,500,000 per year along with fixed costs of
$3,500,000 per year.
If Daily's marginal tax rate is 31%, what will be the cash flow
in each of years 1 to 8 (the cash flow will be the same each
year)?
Enter your answer rounded to the nearest whole...
Daily Enterprises is purchasing a $6,000,000 machine. The machine will be depreciated using straight-line depreciation over...
Daily Enterprises is purchasing a $6,000,000 machine. The
machine will be depreciated using straight-line depreciation over
its 6-year life and will have no salvage value. The only costs are
fixed costs of $2,000,000 per year. What is the net present value
break-even level of sales revenue if the tax rate is 40 percent and
the discount rate is 10 percent?
The following capital budgeting proposal: $100,000 initial cost, to be depreciated straight- line over 5 years...
The following capital budgeting proposal: $100,000 initial
cost, to be depreciated straight-
line over 5 years to an expected salvage value of $5,000, 35%
tax rate, $45,000 additional
annual revenues, $15,000 additional annual expense, $8,000
additional investment in
working capital, and 10% cost of capital. Calculate the
following methods.
1. NPV
2. Payback period
3. Modified IRR, a required rate of return is 12%
4. Briefly compare and contrast the NPV, Payback period and
MIRR criteria,
What are the advantages...
The following capital budgeting proposal: $100,000 initial cost, to be depreciated straight- line over 5 years...
The following capital budgeting proposal: $100,000 initial cost,
to be depreciated straight-
line over 5 years to an expected salvage value of $5,000, 35% tax
rate, $45,000 additional
annual revenues, $15,000 additional annual expense, $8,000
additional investment in
working capital, and 10% cost of capital. Calculate the following
methods.
1. NPV
2. Payback period
3. Modified IRR, a required rate of return is 12%
4. Briefly compare and contrast the NPV, Payback period and MIRR
criteria,
What are the advantages...
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