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A candy company company invests $10 million in a steam boiler. The machine belongs to asset class 43 and has a capital cost allowance (CCA)
A candy company company invests $10 million in a steam boiler. The machine belongs to asset class 43 and has a capital cost allowance (CCA) rate of 30%. It is expected that the new machine will increase revenues by $8 million per year with production and support costs of $0.4 million per year. If the company sold it immediately after the end of year 3 for $7 million, what would the net present value (NPV) of owning the asset be, given a tax rate of 30%, and a cost of capital of 13%? How would this be solved? (Not in excel) A candy company company invests $10 million in a steam boiler. The machine belongs to asset class 43 and has a capital cost allowance (CCA) rate of 30%. It is expected that the new machine will increase revenues by $8 million per year with production and support costs of $0.4 million per year. If the company sold it immediately after the end of year 3 for \$7 million, what would the net present value (NPV) of owning the asset be, given a tax rate of 30%, and a cost of capital of 13%
A candy company company invests $10 million in a steam boiler. The machine belongs to asset class 43 and has a capital cost allowance (CCA) rate of 30%. It is expected that the new machine will increase revenues by $8 million per year with production and support costs of $0.4 million per year. If the company sold it immediately after the end of year 3 for $7 million, what would the net present value (NPV) of owning the asset be, given a tax rate of 30%, and a cost of capital of 13%?
How would this be solved? (Not in excel)
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