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please show for periods 0-5 A construction company is considering acquiring a new earthmover. The purchase price is $105,000, and an additional $25,000 is required
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A construction company is considering acquiring a new earthmover. The purchase price is $105,000, and an additional $25,000 is required to modty the equipment for special use by the company The equipment talis into the MACRS seven-year classification (the tax life), and it wilt be sold after five years (the project life) for 548,000 . The purchase of the earthmover wil have no effect on revenues, but the machine is expected to save the fim $72,000 per year in before-tax operating costs, mainly labor. The firm's marginal tax rate is 30%. Assume that the inital investment is to bo financed by a bank loon at an intorest rate of 12% payable annually. Determine the afler-tax cash flows by using the generalized cash fow approach and the worth of the investment for this project if the firmis MARR is known to be 10%. Click the icon to vew the MACRS depreciation schedules. Click the icon to ves the imerest tactors for discrete compounding when i 12% per yoar. Click the kon to verw the interest tactors for dacrote compounding when i= 10 s per year. Fal in the table below. (Round to the neavest doliar) A construction company is considering acquiring a new earthmover. The purchase price is $105,000, and an additional $25,000 is required to modty the equipment for special use by the company The equipment talis into the MACRS seven-year classification (the tax life), and it wilt be sold after five years (the project life) for 548,000 . The purchase of the earthmover wil have no effect on revenues, but the machine is expected to save the fim $72,000 per year in before-tax operating costs, mainly labor. The firm's marginal tax rate is 30%. Assume that the inital investment is to bo financed by a bank loon at an intorest rate of 12% payable annually. Determine the afler-tax cash flows by using the generalized cash fow approach and the worth of the investment for this project if the firmis MARR is known to be 10%. Click the icon to vew the MACRS depreciation schedules. Click the icon to ves the imerest tactors for discrete compounding when i 12% per yoar. Click the kon to verw the interest tactors for dacrote compounding when i= 10 s per year. Fal in the table below. (Round to the neavest doliar) Step by Step Solution
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