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Calculating initial investment DuPree Coffee Roasters, Inc., wishes to expand and modernize its facilities. The installed cost of a proposed computer-controlled automatic-feed roaster will be
Calculating initial investment DuPree Coffee Roasters, Inc., wishes to expand and modernize its facilities. The installed cost of a proposed computer-controlled automatic-feed roaster will be $139,000. The firm has a chance to sell its 4-year-old roaster for $34,900. The existing roaster originally cost $59,400 and was being depreciated straight-line over 7 years. DuPree pays taxes at a rate of 40%. a. What is the book value of the existing roaster? b. Calculate the after-tax proceeds of the sale ofthe existing roaster c. Calculate the change in net working capital using the following figures
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