Question
Bulld Corporation wants to purchase a new machine for $288,000. Management predicts that the machine can produce sales of $184,000 each year for the next
Bulld Corporation wants to purchase a new machine for $288,000. Management predicts that the machine can produce sales of $184,000 each year for the next 8 years. Expenses are expected to Include direct materials, direct labor, and factory overhead (excluding deprecation) totaling $79,000 per year. The firm uses straight-line depreciation with no residual value for all depreciable assets. Bulld's combined Income tax rate Is 40%. Management requires a minimum after-tax rate of return of 11% on all Investments. What is the net after-tax cash Inflow in Year 1 from the Investment?
Multiple Choice
- $53.400.
- $77.400.
- $89.400.
- $93,400.
- $101.400.
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