ZuoTi.Pro
Question

The diesel Corporation purchase equipment with a cost basis of $12,000,000 for an eight-year project. The equipment is being

business   accounting   
0 0
Add a comment Improve this question Transcribed image text
Next > < Previous
Sort answers by oldest

Homework Answers

Answer #1

Solution:Computation of Depreciation Years Particulars 1 2 3 4 6 7 8 Rate of Dep (7-year MARCS) (Half-Year Convention) Depreciation ($

Workings on Excel:

В C D Е G Н К L 1 Computation of Depreciation 2 3 Years 2 3 7 8 4 5 Particulars 6 4 Rate of Dep (7-year MARCS) (Half-Year Con

In case of any doubts, please comment

0 0
Add a comment
Know the answer?
Add Answer to:
The diesel Corporation purchase equipment with a cost basis of $12,000,000 for an eight-year project. The...
Your Answer:

Post as a guest

Your Name:

What's your source?

Earn Coins

Coins can be redeemed for fabulous gifts.

Log In

Sign Up

Not the answer you're looking for? Ask your own homework help question. Our experts will answer your question WITHIN MINUTES for Free.
Similar Homework Help Questions

  • XYZ company purchased equipment with a cost basis of $10,500,000 for an eignt year project. The...

    XYZ company purchased equipment with a cost basis of $10,500,000 for an eignt year project. The equipment is being depreciated using 7-year MACRS. Annual revenues are $8,000,000. Direct material costs are $2,350,000 and direct labor costs are $1,400,000. Overhead exclusive of depreciation is $970,000. Taxes are charged at 21%. The equipment is expected to be sold at the end of the project for $1,200,000. a) Complete an income statement for the project. omplete a cash flow statement for the project.

  • Graziano Corporation (GC) is considering a project to purchase new equipment. The equipment would be depreciated...

    Graziano Corporation (GC) is considering a project to purchase new equipment. The equipment would be depreciated by the straight-line method over its 3-year life and would have a zero-salvage value. The project requires an investment of $6,000 today on net working capital. Revenues and other operating costs are expected to be constant over the project's 3-year life. However, this project would compete with other company’s products and would reduce its pre-tax annual cash flows of $5,000 per year. The investment...

  • A taxable entity is planning to purchase an equipment that will save 2,000 per year for...

    A taxable entity is planning to purchase an equipment that will save 2,000 per year for 5 years. Cost of the equipment is 7,000. For tax purposes, this machine can be depreciated in 3 years using straight line method. Assume tax rate to be 40% and discount rate to be 9%. a) What is the savings in each of the five years? b) What is the NPV of the project? c) Should the entity purchase the equipment? Please put in...

  • ABC, Inc is planning the purchase of a new equipment which will cost $34,485. The project...

    ABC, Inc is planning the purchase of a new equipment which will cost $34,485. The project is expected to last for 6 years. The equipment will have a book value of $3,336 at the end of Year 6. The increase in net working capital is expected to be $2,231, all of which will be recouped at the end of the project. The project is expected to have annual operating cash flows of $12,405. What is the Total Cash Flow in...

  • Percentage complete, Cost Basis. I need help figuring out the percentages to date and percentages yearly....

    Percentage complete, Cost Basis. I need help figuring out the percentages to date and percentages yearly. I initially did 44% but since it says round to two decimal places I changed it to 44.44 and got different numbers. Please help! ($ millions) $ 25.00 Expected Revenue (contract amount in millions of dollars) $ millions) Project Started 20X1 20X2 18.00 $ 20.00 $ 8.00 $ 9.50 $ 9.00 $ 10.00 $ 8.50 $ 9.50 $ Estimated Total Cost (per Engineering) Actual...

  • Gateway Communications is considering a project with an initial fixed assets cost of $1.63 million that...

    Gateway Communications is considering a project with an initial fixed assets cost of $1.63 million that will be depreciated straight-line to a zero book value over the 10-year life of the project. At the end of the project the equipment will be sold for an estimated $233,000. The project will not change sales but will reduce operating costs by $384,000 per year. The tax rate is 40 percent and the required return is 10.8 percent. The project will require $48,500...

  • A company is considering a three-year project. New equipment will cost $200,000. The equipment falls in...

    A company is considering a three-year project. New equipment will cost $200,000. The equipment falls in the MACRS three-year class (.3333, .4445, .1481, .0741) it will have a salvage value at the end of the project of $50,000. The project is expected to produce sales of $100,000 in the first year and sales will increase by $50,000 each year after that. Expense are expected to be 40% of sales. An investment in net-working capital of $5,000 is required at the...

  • BASIC INFORMATION: A three-year project will cost $60,000 to construct. This will be depreciated straight-line to...

    BASIC INFORMATION: A three-year project will cost $60,000 to construct. This will be depreciated straight-line to zero over the three-year life. The price per unit sold is $20 and the variable cost per unit sold is $10. Fixed costs are $30,000 per year. In addition to the BASIC INFORMATION, you find that a salvage company will pay you $10,000 for the assets at the end of year 3. The project will require an investment of $10,000 up front for net...

  • (11) An investment project provides cash inflows of $765 per year for eight years. What is...

    (11) An investment project provides cash inflows of $765 per year for eight years. What is the project payback period if the initial cost is $2,400? What if the initial cost is $3,600? What if it is $6,500? (12) An investment project has annual cash inflows of $4,200, $5,300, $6,100, and $7,400, and a discount rate of 14%. What is the discounted payback period for these cash flows if the initial cost is $7,000? What if the initial cost is...

  • The Bruin's Den Outdoor Gear is considering a new 7-year project to produce a new tent...

    The Bruin's Den Outdoor Gear is considering a new 7-year project to produce a new tent line. The equipment necessary would cost $1.63 million and be depreciated using straight-line depreciation to a book value of zero. At the end of the project, the equipment can be sold for 15 percent of its initial cost. The company believes that it can sell 26,500 tents per year at a price of $70 and variable costs of $30 per tent. The fixed costs...

ADVERTISEMENT
Free Homework Help App
Download From Google Play
Scan Your Homework
to Get Instant Free Answers
Need Online Homework Help?
Ask a Question
Get Answers For Free
Most questions answered within 3 hours.
ADVERTISEMENT
ADVERTISEMENT
ADVERTISEMENT