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help please A company is considering a factory to manufacture fine zithers, which will have a market for 4 years. The machinery necessary for production,
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A company is considering a factory to manufacture fine zithers, which will have a market for 4 years. The machinery necessary for production, costs $4.1 million. The machine will be depreciated as per the MACRS schedule: 33% in 1st year, 45% in 2 nd, 15% in 3rd and 7% in 4 th year. Scrap value is 450,000 at the end of the 4 th year: The current market value of the land on which the factory will be built is $1.6 million. In 4 years, the land could be sold for $1.55 milion. Three years ago, the company had bought this land for $1.39 million in anticipation of using it as a toxic waste site but has recently outsourced it to another company. The revenues for each of the four years is estimated to be Step by Step Solution
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