1.
=-675000+181000*(1-35%)/1.15^5-51000+51000/1.15^5+187600/15%*(1-1/1.15^5)
=-13286.85
2.
=-1.37*10^6+205500*(1-40%)/1.111^6-209000+209000/1.111^6+((25500*(68-28)-435000-1.37*10^6/6)*(1-40%)+1.37*10^6/6)/11.1%*(1-1/1.111^6)=463633.304185007
5) Lakeside Winery is considering expanding its winemaking operations. The expansion will require new equipment cos...
5) Lakeside Winery is considering expanding its winemaking operations. The expansion will require new equipment costing $675,000 that would be depreciated on a straight-line basis to zero over the 5-year life of the project. The equipment will have a salvage value of $181,000 at the end of the project. The project requires $51,000 initially for net working capital, which will be recovered at the end of the project. The operating cash flow will be $187,600 a year. What is the...
Lakeside Winery is considering expanding its winemaking operations. The expansion will require new equipment costing $697,000 that would be depreciated on a straight-line basis to zero over the 5-year life of the project. The equipment will have a market value of $192,000 at the end of the project. The project requires $62,000 initially for net working capital, which will be recovered at the end of the project. The operating cash flow will be $187,600 a year. What is the net...
23. Lakeside Winery is considering expanding its winemaking operations. The expansion will require new equipment costing $708,000 that would be depreciated on a straight-line basis to a zero balance over the four-year life of the project. The equipment can be sold for $220,000 after the four years. The project requires $46,000 initially for net working capital, all of which will be recovered at the end of the project. The projected operating cash flow is $211,500 a year. What is the...
Lakeside Winery is considering expanding its winemaking operations. The expansion will require new equipment costing $685,000 that would be depreciated on a straight-line basis to zero over the 4-year life of the project. The equipment will have a market value of $186,000 at the end of the project. The project requires $56,000 initially for net working capital, which will be recovered at the end of the project. The operating cash flow will be $210,600 a year. What is the net...
Question 20 1 points Save Answer Lakeside Winery is considering expanding its winemaking operations. The expansion will require new equipment costing 5675.000 that would be depreciated on a straight-line basis to zero over the 5-year life of the project. The equipment will have a market value of $181.000 at the end of the project. The project requires 551.000 initially for net working capital, which will be recovered at the end of the project. The operating cash flow will be $187,600...
The Bruin's Den Outdoor Gear is considering a new 7-year project to produce a new tent line. The equipment necessary would cost $1.67 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 10 percent of its initial cost. The company believes that it can sell 27,000 tents per year at a price of $71 and variable costs of $31 per tent. The fixed costs...
The Bruin's Den Outdoor Gear is considering a new 7-year project to produce a new tent line. The equipment necessary would cost $1.99 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 10 percent of its initial cost. The company believes that it can sell 31,000 tents per year at a price of $79 and variable costs of $38 per tent. The fixed costs...
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...
Question 17 10 pts Western Tech is considering a new project that will require $118,000 of fixed assets and networking capital of $16,000. The fixed assets will be depreciated on a straight-line basis to a zero salvage value over three years. This project is expected to produce an operating cash flow of $45,000 the first year with that amount decreasing by 5 percent annually for two years before the project is shut down. The fixed assets can be sold for...
Your company is considering a new project that will require $100,000 of new equipment at the start of the project. The equipment will have a depreciable life of 10 years and will be depreciated to a book value of $25,000 using straight-line depreciation. The cost of capital is 11 percent, and the firm's tax rate is 34 percent. Estimate the present value of the tax benefits from depreciation.