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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
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 $36,000. The existing roaster originally cost $60,500 and was being depreciated straight-line over 7 years. DuPree pays taxes at a ate of 40%. . What is the book value of the existing roaster? b. Calculate the after-tax proceeds of the sale of the existing roaster. c. Calculate the change in net working capital using the following figures: Anticipated Changes in Current Assets and Current Liabilities Accruals Inventory Accounts payable Accounts receivable Cash Notes payable -$19,100 +49,700 +39,900 +69,200 0 +14,400 d. Calculate the initial investment associated with the proposed new roaster. a. The remaining book value of the existing roaster is $ (Round to the nearest dollar.) b. The after-tax proceeds of the sale of the existing roaster will be $ (Round to the nearest dollar.) c. The change in net working capital will be $ (Round to the nearest dollar.) d. The initial investment associated with the proposed new roaster will be $ (Round to the nearest dollar.)
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