Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Question 9 1 pts DSSS Corporation DSSS Corporation is considering a new project to manufacture widgets. The cost of the manufacturing equipment is $135,000. The

image text in transcribed
Question 9 1 pts DSSS Corporation DSSS Corporation is considering a new project to manufacture widgets. The cost of the manufacturing equipment is $135,000. The cost of shipping and installation is an additional $14,500. The asset will fall into the 3-year MACRS class. The year 1-4 MACRS percentages are 33.33%, 44.45%, 14.81%, and 7.41%, respectively. Sales are expected to be $230,000 per year. Cost of goods sold will be 65% of sales. The project will require an increase in net working capital of $14,500. At the end of three years, DSSS plans on ending the project and selling the manufacturing equipment for $30,000. The marginal tax rate is 35% and DSSS Corporation's appropriate discount rate is 14%. The fixed expenses is $12,000. Refer to DSSS Corporation. What is the depreciation expense in year 3? $22,141 $11,078 $66,453 $49,828

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

The Private Equity Toolkit A Step By Step Guide To Getting Deals Done From Sourcing To Exit

Authors: Tamara Sakovska

1st Edition

1119697107, 978-1119697107

More Books

Students also viewed these Finance questions

Question

What is Larmors formula? Explain with a suitable example.

Answered: 1 week ago

Question

4. Identify cultural variations in communication style.

Answered: 1 week ago