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Question 6 11 pts You are considering buying a new tractor that costs $200,000 that is expected to last frwe years. Apply straight line depreciation

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Question 6 11 pts You are considering buying a new tractor that costs $200,000 that is expected to last frwe years. Apply straight line depreciation to the tractor which will have a salvage value of zero at the end of its useful life. You anticipate being able to sale the tractor for $19.500n five years' time. Your margnal tax rate is 25% and expect a rate of return of 95% to your investments. Assume no investment tax credit Atter tax Flow Growth Discount Rate Rate PFactor tem Pre-Tax Flow After-tax Flow Years Present Value Machine-$200,000 $200,000 00951 Depr Shield 1-500.095 Terminal Value 50 0.095 NPV NPC Question 7 6 pts Use the information regarding the $200,000 tractor to answer the following questions What is the pre-tax recovery cost for this tractor? Hint: Calculate the cost recovery factor first Use the cost recovery factor to annualize the NPC next Once you have annualized the NPC, account for the tax rate to get the pre-tax recovery cost that is asked for initially in this question Question 6 11 pts You are considering buying a new tractor that costs $200,000 that is expected to last frwe years. Apply straight line depreciation to the tractor which will have a salvage value of zero at the end of its useful life. You anticipate being able to sale the tractor for $19.500n five years' time. Your margnal tax rate is 25% and expect a rate of return of 95% to your investments. Assume no investment tax credit Atter tax Flow Growth Discount Rate Rate PFactor tem Pre-Tax Flow After-tax Flow Years Present Value Machine-$200,000 $200,000 00951 Depr Shield 1-500.095 Terminal Value 50 0.095 NPV NPC Question 7 6 pts Use the information regarding the $200,000 tractor to answer the following questions What is the pre-tax recovery cost for this tractor? Hint: Calculate the cost recovery factor first Use the cost recovery factor to annualize the NPC next Once you have annualized the NPC, account for the tax rate to get the pre-tax recovery cost that is asked for initially in this

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