Homework Answers
The correct answer is:-
d) The cost of the equipment plus tax, shipping cost and installation cost for it ready to use.
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The acquisition cost of the piece of equipment should be: Select one or more: O a....
A company is evaluating the acquisition of a new piece of equipment. The base price of...
A company is evaluating the acquisition of a new piece of equipment. The base price of the equipment is $100,000 and it will cost an additional $10,000 for shipping and installation. The company also paid a firm $5,000 to determine the feasibility of the new piece of equipment. The equipment falls in the MACRS 3 year class and would be sold after 4 years for $18,000. The new equipment would require an increase in inventory of $4,000, which will be...
The Bistro is planning to add a new line of noodles that will require the acquisition of new processing equipment. The equipment will cost $1,000,000, including installation and shipping. It will be depreciated straight-line to zero value over the 10-year
The Bistro is planning to add a new line of noodles that will require the acquisition of new processing equipment. The equipment will cost $1,000,000, including installation and shipping. It will be depreciated straight-line to zero value over the 10-year economic life of the project. Interest cost associated with financing the equipment purchase is estimated to be $40,000 annually. The expected salvage value of the machine at the end of 10 years is $200,000. One year ago a marketing survey...
Property, plant, and equipment are conventionally presented in the balance sheet at Select one: o a....
Property, plant, and equipment are conventionally presented in the balance sheet at Select one: o a. original cost less residual value O b. fair value less book value 0 C. original cost less accumulated depreciation 0 d. fair value less residual value
On January 1, Year 1, Fukisan purchased a new piece of equipment for specialized-furniture manufacturing at...
On January 1, Year 1, Fukisan purchased a new piece of
equipment for specialized-furniture manufacturing at a cost of
$300,000, inclusive of shipping and installation. At the time of
purchase, the equipment had an estimated useful life of 15 years
and an expected salvage value of $10,000 at the end of the 15
years.
For future budgeting purposes, Eric Anderson, CFO of Fukisan
Inc. has asked you to perform the depreciation expense calculations
for Year 2, Year 3, and Year...
1.The equipment cost (equipment plus shipping and installation) can be depreciated at the rate of 48%...
1.The equipment cost (equipment plus shipping and installation) can be depreciated at the rate of 48% the first year. The remaining 5 years (years 2-6) the depreciation will be equal to $30,000 per year. What is the amount of depreciation in year 1? 2. Consider the following capital budgeting and cash flow estimation problem. You have developed a new energy drink that uses various vegetables. The drink is called V-DRINK. You have an existing building that you are using to...
Focus Inc. is considering the acquisition of a new piece of equipment. The machine's price is...
Focus Inc. is considering the acquisition of a new piece of equipment. The machine's price is $750.000. In addition, installation and transportation costs would be $60.000 and it would require $15,000 in spare parts thus increasing the firm's net working capital by that amount. The system falls into the MACRS 3-year class (depreciation rates of 33%, 45%, 15%, and 7%). The current machine it would replace could be sold for $85,000 and currently is being earried on the books for...
5. 42 points. A new piece of equipment, costing $80,000, will be depreciated via straight-line method...
5. 42 points. A new piece of equipment, costing $80,000, will be depreciated via straight-line method over four years. The equipment will require shipping and installation of $20,000 and an increase in inventory of $10,000. In addition, account payables will increase by $7,000 while account receivables will increase by $11,000. This profitable firm's tax rate is 40%. The annual cost savings are expected to be $47,000/year for each of the four years it will be used. The expected resale (salvage)...
Kayla’s Cookie Company purchased a used piece of equipment that initially cost $33,000 for a discounted...
Kayla’s Cookie Company purchased a used piece of equipment that initially cost $33,000 for a discounted cost of $30,000. Sales tax totaled $1805. Delivery of the equipment to Kayla’s business site cost $1,000. Unfortunately, a worker slipped while carrying the equipment down the stairs and it cost $500 to repair before it could be installed. Installation costs totaled $2,500. The maintenance for the first year of use was $1,200. Determine whether each item should be included, excluded, or cannot be...
A company purchased a piece of equipment by paying $15,000 cash. A shipping cost of $900...
A company purchased a piece of equipment by paying $15,000 cash. A shipping cost of $900 to get the equipment to its factory was also incurred. The fair value of the equipment was $9,000 at the time of the purchase. For what amount should the company record the equipment? $15,000. $15,900. $9,000. $9,900
Foster Inc. is trying to decide whether to lease or purchase a piece of equipment needed...
Foster Inc. is trying to decide whether to lease or purchase a piece of equipment needed for the next ten years. The equipment would cost $49,000 to purchase, and maintenance costs would be $5,200 per year. After ten years, Foster estimates it could sell the equipment for $27,000. If Foster leases the equipment, it would pay $13,000 each year, which would include all maintenance costs. (Future Value of $1, Present Value of $1, Future Value Annuity of $1, Present Value...
Property, plant, and equipment are conventionally presented in the balance sheet at Select one: o a. original cost less residual value O b. fair value less book value 0 C. original cost less accumulated depreciation 0 d. fair value less residual value
On January 1, Year 1, Fukisan purchased a new piece of
equipment for specialized-furniture manufacturing at a cost of
$300,000, inclusive of shipping and installation. At the time of
purchase, the equipment had an estimated useful life of 15 years
and an expected salvage value of $10,000 at the end of the 15
years.
For future budgeting purposes, Eric Anderson, CFO of Fukisan
Inc. has asked you to perform the depreciation expense calculations
for Year 2, Year 3, and Year...
Focus Inc. is considering the acquisition of a new piece of equipment. The machine's price is $750.000. In addition, installation and transportation costs would be $60.000 and it would require $15,000 in spare parts thus increasing the firm's net working capital by that amount. The system falls into the MACRS 3-year class (depreciation rates of 33%, 45%, 15%, and 7%). The current machine it would replace could be sold for $85,000 and currently is being earried on the books for...
5. 42 points. A new piece of equipment, costing $80,000, will be depreciated via straight-line method over four years. The equipment will require shipping and installation of $20,000 and an increase in inventory of $10,000. In addition, account payables will increase by $7,000 while account receivables will increase by $11,000. This profitable firm's tax rate is 40%. The annual cost savings are expected to be $47,000/year for each of the four years it will be used. The expected resale (salvage)...
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