Answered step by step
Verified Expert Solution
Question
1 Approved Answer
Below table shows the calculations for an after tax analysis of a machine purchase alternative EOY 0 1 2 3 BTCF - 20.000 16.000 16.000
Below table shows the calculations for an after tax analysis of a machine purchase alternative EOY 0 1 2 3 BTCF - 20.000 16.000 16.000 16.000 16.000 16.000 16.000 2.000 Depreciation Taxable Income Deduction Income Taxes 0 0 0 3.000 13.000 -6.500 3.000 13.000 -6.500 3.000 13.000 -6.500 3.000 13.000 -6.500 3.000 13.000 -6.500 3.000 13.000 -6.500 0 0 ATCT - 20.000 9.500 9.500 9.500 9.500 9.500 9.500 2.000 4 5 6 6 (a) Find answers to the below questions i. What are the cost basis (price) and annual revenues less expenses" ? ii. What is the terminal market value (or salvage value) ? iii. What is the income tax rate? iv. What is the method used for depreciation deductions? V. What is the book value at the end of useful life? (b) Calculate the equivalent present worth (PW) and the equivalent annual worth (AW) at an after-tax MARR of 10%
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started