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Any help if possible Thanks. Which of the following is considered a side effect when determining incremental cash flows for a new product? A. The
Any help if possible Thanks.
Which of the following is considered a side effect when determining incremental cash flows for a new product? A. The use of factory floor space which is currently unused but available for production of any product. B. Revenues from the existing product that would be lost as a result of some customers switching to the new product. C. Shipping and installation costs associated with preparing the machine to be used to produce the new product. D. The cost of a product analysis completed in the previous year and specific to the new product. E. None of the above. A firm owns a building with a book value of $100,000 and a market value of $250,000. If the building is utilized for a project, then the opportunity cost ignoring taxes is: A. $0 B. $100,000 C. $150,000 D. $250,000 E. None of the above Which of the following is not included in the estimated project cash flows in capital budgeting analysis? A. changes in net working capital B. shipping and installation costs for new equipment C. interest expense D. operating cash flow E. terminal cash flow If the depreciable investment is $500,000 and the MACRS 5 year class schedule is: Year 1: 20%, Year 2: 32%, Year 3: 19.2%, Year 4: 11.5%, Year 5: 11.5% and Year 6: 5.8%, calculate the depreciation tax shield for Year 2 using a tax rate of 30%. A. $80,000 B. $30,000 C. $48,000 D. $17, 250 E. $28, 800Step by Step Solution
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