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Problem 5: Book value and recaptured depreciation (14 points) Similar to E11-4 Current Enterprise invested in purchasing a new inventory system which cost $324,400 installed.

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Problem 5: Book value and recaptured depreciation (14 points) Similar to E11-4 Current Enterprise invested in purchasing a new inventory system which cost $324,400 installed. Since that purchase depreciation has totaled $294,000. A. What is the current book value of the system? Installed cost - depreciation = B. If the system sold for $115,000, how much recaptured depreciation would result? Sales price - current book value = flows. cash E11-3 Landscapes Unlimited has spent $2,200 evaluating a new service area for expanding its business territory. The expansion will require the purchase of a new truck for $35,000, and fitting the truck with a flatbed that will cost $6,500 to install. The company would realize 58,250 in after-tax proceeds from the sale of an old truck. If Landscapes' working capital is unaffected by this project, what is the initial invest- ment amount for this project? E11-4 A few years ago, Largo Industries implemented an inventory auditing system at an installed cost of $175,000. Since then, it has taken depreciation deductions totaling $124,250. What is the system's current book value? If Largo sold the system for $110,000, how much recaptured depreciation would result? E11-5 Bryson Sciences is planning to purchase a high-powered microscopy machine for $385,000 and incur an additional $31,300 in installation expenses. It is replacing older microscopy equipment that can be sold for $116,500, resulting in taxes from a gain on the sale of $42,600. Because of this transaction, current assets will increase by $11,000, and current liabilities will increase by $5,200. Calculate the initial investment in the high-powered microscopy machine. MS X All problems are available in MyLab Finance. The Mylab icon indicates problems in Excel format available in MyLab Finance

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