BT-CF - O & M expenses- Depreciation
Net profit = 60000-10000 - 20000
30000
Net cash flow = Profits - taxes
30000-35% of 30000
30000-10500
19500
Depreciation = 120000/6 (150000-30000)
Taxes =
First cost of equipment = $150,000 Market value at the end of year 6 = $30,000 MACRS depreciation is used. The equipmen...
the answer is no $43,000
First cost of equipment = $150,000 Market value at the end of year 6 = $30,000 MACRS depreciation is used. The equipment is a 5-year property. Incremental income-tax rate for the company = 35% 4 Year 10 BT-CF in $ -150K O&M Expenses 1 60K 10K 2 63K 13K 3 66K 16K 5 172K 22K 75K 25K 19K Reference: Case Study 12 The first-year after tax-cash flow is
First cost of equipment = $200,000 Market value at the end of year 6 = $10,000 MACRS depreciation is used. The equipment is a 5-year property. incremental income-tax rate for the company-35% Year 0 4 BT-CF 200K 60K 63K 66K 6K 72K75K in $ Market value 10K The first-year after tax-cash flow is equal to
Income Statement, Depreciation table (20 points) Equipment with a first cost of $120.000 is depreciated by MACRS wil period. The estimated expenses are $17,500 each year, annual revenues effective tax rate is 40%. preciated by MACRS with a 5-year recovery year; annual revenues are $90,000. The (a) (10 points) Construct a table showing yearly depreciation rate, dep book value to fully depreciate the machine. any depreciation rate, depreciation amount, and 10 points) Construct a complete income statement (using the format...
Philadelphia Fastener Corporation manufactures nails, screws,
bolts, and other fasteners. Management is considering a proposal to
acquire new material-handling equipment. The new equipment has the
same capacity as the current equipment but will provide operating
efficiencies in labor and power usage. The savings in operating
costs are estimated at $150,000 annually.
The new equipment will cost $300,000 and will be purchased at the
beginning of the year when the project is started. The equipment
dealer is certain that the equipment...