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DataPoint Engineering is considering the purchase of a new plece of equipment for $265,000. It has an elght-year midpoint of Its asset depreclation range (ADR).
DataPoint Engineering is considering the purchase of a new plece of equipment for $265,000. It has an elght-year midpoint of Its asset depreclation range (ADR). It will require an additional Initial Investment of $120,000 in nondepreclable working capital. $30,000 of this Investment will be recovered after the slxth year and will provide additional cash flow for that year. Income before depreclation and taxes for the next slx are shown in the following table. Use Table 12-11. Table 12-12. Use Appendix B for an approximate answer but calculate your final answer using the formula and financlal calculator methods. The tax rate is 25 percent. The cost of capital must be computed based on the following: a. Determine the annual depreclation schedule. Note: Do not round intermediate calculations. Round your depreclation base and annual depreciation answers to the nearest whole dollar. Round your percentage depreclation answers to 3 decimal places
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