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DataPoint Engineering is considering the purchase of a new piece of equipment for $310,000. It has an eight-year midpoint of its asset depreciation range (ADR).

DataPoint Engineering is considering the purchase of a new piece of equipment for $310,000. It has an eight-year midpoint of its asset depreciation range (ADR). It will require an additional initial investment of $130,000 in nondepreciable working capital. Fifty-two thousand dollars of this investment will be recovered after the sixth year and will provide additional cash flow for that year. Income before depreciation and taxes for the next six are shown in the following table. Use Table 1211, Table 1212. Use Appendix B for an approximate answer but calculate your final answer using the formula and financial calculator methods.

Year Amount
1 $ 206,000
2 174,000
3 144,000
4 129,000
5 102,000
6 92,000

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DataPort E een g i5 co s err the pur heee of a new pece o equp en SJ 10.000 It has an egh year midpont its and wil provide additional cash f w for that year. I come ba e depreciation and taxes or a na sie shown in the fol ir 5 et des csation ange ADR lt re re an additi n intial inves mer o S1 00 in n n precable work ng c pita Fity-two tousand dolars of th8 ne ment wil be tabla. Use Table 12-11, ble 12-12 Ge Aepend B for an appo inata a e wer but c culate your final ans er usin a rmnda and fin reia ca lator methods. overed r the h yea Year Amount $206,000 2 174,000 144,000 4129,000 5 102.000 6 92,000 Th tax rato is 30 percent. The ocet of oapta muat bo computed based on the fo10Mng: Cost Debl Preferred stock Kp 1240 10 Common euyK 17.00 55 relained earnings) Kg 0.30% 35% Dotenmine the annual depreciation schedule. (De not round intermediate calculations. Round your depreciation base and annual depreciation answers to the nearest whole dollar. Round your percentage depreciation anewers to 3 decimal places b. Datormine the annual cash Now for each year. Ba sure to include the racovered working captal in Yoar 6.(Do not round intermediate calculatiens and round your answers to 2 decimal places. Cash . Dotanmine the waightad avarage cost of capital. Do net round intermediate calculations. Enter your answer as a parcent rounded to 2 decimal places Weighted avorage oost of d-1. Detem ne the not present value se the WACC from part c rounded to 2 decimal places as a percent as the cost of capital e . 12.34%). Do not round any other intermediate calculations Round your answer to 2 decimal places

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