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please answer a b and C Year 12345 Revenue $41,400 42,400 43,400 44,400 45,400 New Lathe Expenses (excluding depreciation and Interest) $29,300 29,300 29,300 29,300
please answer a b and C
Year 12345 Revenue $41,400 42,400 43,400 44,400 45,400 New Lathe Expenses (excluding depreciation and Interest) $29,300 29,300 29,300 29,300 29,300 Revenue $34,500 34,500 34,500 34,500 34,500 Old Lathe Expenses (excluding depreciation and interest) $26,200 26,200 26,200 26,200 26,200 Operating cash inflows Strong Tool Company has been considering purchasing a new lathe 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 $2,380 in Year 1; $3,808 in Year 2; $2.261 in Year 3: $1,428 in both Year 4 and Year 5; and $595 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 inflows associated with each lathe. (Note: Be sure to consider the depreciation in year 6.), b. Calculate the operating cash inflows resulting from the proposed lathe replacement. c. Depict on a time line the incremental operating cash inflows calculated in part b. a. Calculate the operating cash inflows associated with each lathe. (Note: Be sure to consider the depreciation in year 6.), b. Calculate the operating cash inflows resulting from the proposed lathe replacement. c. Depict on a time line the incremental operating cash inflows calculated in part b. a. Calculate the operating cash inflows associated with the new lathe below: (Round to the nearest dollar.) Revenue Expenses (excluding depreciation and interest) Profit before depreciation and taxes Depreciation Net profit before taxes Taxes Year Net profit after taxes Operating cash flows 1 Step by Step Solution
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