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A) What is the after-tax cash flow if the loader is acquired? B) What is the equivalent annual cash flow the firmc an expect by
A) What is the after-tax cash flow if the loader is acquired?
B) What is the equivalent annual cash flow the firmc an expect by owning and operating this loader at an interst rate of 12%?
Tucson Solar Company builds residential salar homes. Because of an anticipated increase in business volume, the company is considering the acquisition of a loader at a cost of $54,000. This acquisitian cost includes delivery charges and applicable taxes. The firm has estimated that if the loader is acquired, the additional revenues and operating expenses (excluding depreciation) should be expected as given in the table below. The projected revenue is assumed to be in cash in the year indicated, and all the additional operating expenses are expected to be paid in the yoar in which they are incurred. The estimated salvage value for the loader at the end of the sixth year is $8,000. The firm's incremental (marginal) tax rate is 25%. Click the icon to view the estimated operating data on the company. More Info Click the icon to view the interest factors for discrete compounding when i-12% per year. (a) What is the after-tax cash flow if the loader is acquired? Fill in the table below. (Raund to t End of Year Additional Operating Revenue $66,000 $70,000 $74,000 $80,000 $64,000 $50,000 Additional Operating Expenses, Excluding Depreciation $29,000 $28,400 $32,000 $38,800 $31,000 $25,000 Allowed Tax Depreciation $10,800 $17,280 $10,368 $6,221 $6,221 $3,110 PrintDone Enter your answer in the edit fields and then click CheckStep by Step Solution
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