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Operating cash flows Strong Tool Company has been considering purchasing a new late to replace a fully depreciated lathe that would otherwise last 5 more

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Operating cash flows Strong Tool Company has been considering purchasing a new late to replace a fully depreciated lathe that would otherwise last 5 more years. The new lathe is expected to have a 5-year life and depreciation charges of $2,060 in Year 183,296 in Year 2, S1,967 in Year 3, 51,236 in both Year 4 and Year 5 and $515 in Your 6. The firm estimates the revenues and expenses (excluding depreciation and interest) for the new and the old lathes to be as shown in the following table The firm is subject to a 40% tax rate on ordinary income a. Calculate the operating cash flows associated with each lathe. (Note: Be sure to consider the depreciation in year 6.) b. Calculate the operating cash flows resulting from the proposed lathe replacement c. Depict on a timeline the incremental operating cash flows calculated in part b. a. Calculate the operating cash flows associated with the new lathe below (Round to the nearest dollar) Year 1 S S S Revenue Expenses (excluding depreciation and interest) Prolit before depreciation and taxes Depreciation Net profit before taxes Taxes $ 5 S Net profit after taxes $ Operating cash flows Strong Tool Company has been considering purchasing a new lathe to replace a tally depreciated fathe that would otherwise last 5 more years. The new lathe is expected to have a 5-year life and depreciation charges of $2,060 in Year 1; $3,296 in Year 2:51,957 in Yoar 3, S1,236 in both Year 4 and Year 5; and $515 in Year 6. The firm estimates the revenues and expenses (excluding depreciation and interest) for the new and the old lathes to be as shown in the following table The firm is subject to a 40% tax rate on ordinary income. a. Calculate the operating cash flows associated with each lathe. (Note: Be sure to consider the depreciation in year 6.) b. Calculate the operating cash flows resulting from the proposed lathe replacement. c. Depict on a time line the incremental operating cash flows calculated in part b. a. Calculate the operating cash flows associated with the now lathe below. (Round to the nearest dollar Year Revenue $ Expenses (excluding depreciation and interest) Profit before depreciation and taxes $ Depreciation Net profit before taxes Taxes $ $ S Operating cash flows Strong Tool Company has been considering purchasing a new late to replace a fully depreciated lathe that would otherwise last 5 more years. The new lathe is expected to have a 5-year life and depreciation charges of $2,060 in Year 183,296 in Year 2, S1,967 in Year 3, 51,236 in both Year 4 and Year 5 and $515 in Your 6. The firm estimates the revenues and expenses (excluding depreciation and interest) for the new and the old lathes to be as shown in the following table The firm is subject to a 40% tax rate on ordinary income a. Calculate the operating cash flows associated with each lathe. (Note: Be sure to consider the depreciation in year 6.) b. Calculate the operating cash flows resulting from the proposed lathe replacement c. Depict on a timeline the incremental operating cash flows calculated in part b. a. Calculate the operating cash flows associated with the new lathe below (Round to the nearest dollar) Year 1 S S S Revenue Expenses (excluding depreciation and interest) Prolit before depreciation and taxes Depreciation Net profit before taxes Taxes $ 5 S Net profit after taxes $ Operating cash flows Strong Tool Company has been considering purchasing a new lathe to replace a tally depreciated fathe that would otherwise last 5 more years. The new lathe is expected to have a 5-year life and depreciation charges of $2,060 in Year 1; $3,296 in Year 2:51,957 in Yoar 3, S1,236 in both Year 4 and Year 5; and $515 in Year 6. The firm estimates the revenues and expenses (excluding depreciation and interest) for the new and the old lathes to be as shown in the following table The firm is subject to a 40% tax rate on ordinary income. a. Calculate the operating cash flows associated with each lathe. (Note: Be sure to consider the depreciation in year 6.) b. Calculate the operating cash flows resulting from the proposed lathe replacement. c. Depict on a time line the incremental operating cash flows calculated in part b. a. Calculate the operating cash flows associated with the now lathe below. (Round to the nearest dollar Year Revenue $ Expenses (excluding depreciation and interest) Profit before depreciation and taxes $ Depreciation Net profit before taxes Taxes $ $ S

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