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1. 2. 3. four compary has spent $370,000 on research to develop a new computer game. The firm is planning to spend $57,000 on a

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four compary has spent $370,000 on research to develop a new computer game. The firm is planning to spend $57,000 on a machine to aroduce the new game. Shipping and instaltation costs of the machine will be capitalized and depreciated; they total $6,700. The machine has an expected use at your company of 5 years, a $42,000 estimated resale value, and falls under the MACRS 7 Year class life. Revenue from the new game is expected to be $470,000 per year, with costs of $270,000 per yeac. The firm has a tax rate of 21 percent, an opportunity cost of capital of 15 percent and it expects net working capital to increase by $67,000 ot the beginning of the project. What will be the net cash flow for yen one of this project? Metple Cholico 51512 1/65.642) $1,912 $(65,612) $159912 $158,000 Your firm needs a machine which costs $180,000, and requires $39,000 in maintenance for each year of its 5 year life. After 5 years, this machine will be replaced. The machine falls into the MACRS 5 -year class life category. Assume a tax rate of 21% and a discount rate of 16%. What is the depreciotion tax shield for this project in yeat 5 ? Muinple Cholce 54.3540 $20735 51638144 $4.35456 520,736 516.381 .44 $331776 Your firm needs a machine which costs $230,000, and requires $38,000 in maintenance for each year of its 3 year life. After 3 years, this machine will be replaced. The machine falls into the MACRS 3-year class life category. Assume a tax rate of 21% and a discount rate of 13% if this machine can be sold for $23,000 at the end of year 3, what is the after tax salvage value? Muitiple Choice 513,464 51870.00 52174903 $13,464 $18370.00 $2174903 $5,95700

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