Use the following to answer questions 100-104: 617 Hasko Inc. has provided the following data to be used in evaluating a proposed investment project: Initial investment.... Annual cash receipts Life of the project.... Annual cash expenses Salvage value Tax rate.... For tax purposes, the entire initial investment without any reduction for salvage value will be depreciated over 7 years. The company uses a discount rate of 10%. $820,000 $656,000 100. When computing the net present value of the project, what are the annual after-tax cash receipts? A) $410,000 B) $196,800 C) $459,200 D) $60,589 Answer: C Level: Medium LO: 8 Appendix: 14D C) $88,500 D) $383,500 9 years $295,000 $41,000 30% Chapter 14 Capital Budgeting Decisions ghsbull lige siger 101. When computing the net present value of the project, what are the annual after-tax cash expenses? A) $254,000 B) $206,500 depreciation reduce taxes each A) $82,000 B) $35,143 C) $63,778 XD) $27,333 18 sw 30sjung en year Answer: B Level: Medium LO: 8 Appendix: 14D 000,+352 102. When computing the net present value of the project, what is the annual amount of the tax shield? In other words, by how much does the depreciation deduction in which the depreciation deduction is taken? 101 noitsubor na mo 0000482 sufer ins29ng on all grinquos Answer: B Level: Medium LO: 8 Appendix: 14D 000,9812 (8 103. When computing the net present value of the project, what is the after-tax cash flow from the salvage value in the final year? A) $28,700 B) $41,000 C) $0 D) $12,300 8:03 miboM dove Answer: A Level: Medium LO: 8 Appendix: 14D 104. The net present value of the project is closest to: A) $635,299 B) $647,468 C) $818,544 D) $806,375 000.0052 (8 008,8918 (0 8.0.1 muhoMorelowent 5ta 150 oh anitum nad W 01 ng, 12th Edition

Use the following to answer questions 100-104: Hasko Inc, has provided the following data to be used in evaluating a proposed investment project: For tax purposes, the entire initial investment without any reduction for salvage value will be depreciated over 7 years. The company uses a discount rate of 10%. 100. When computing the net present value of the project, what are the annual after-tax cash receipts? A) 5410,000 B) $196,800 (C) $459,200 D) 560,589 Answer: C Level: Medium LO: 8 Appendix: 14D Chapter 14 Capital Budgeting Decisions 101. When computing the net present value of the project, what are the annual afler-exex cath expenses? A) 5254,000 B) 5206,500 C) 588,500 D) $383,500 Answer. B Level: Medium LO: 8 Appendix: 14D 102. When compoting the net present value of the project, what is the arnual amount of the depreciation tax shield? In other words, by how moch does the depreclation deduction A) $82,000 B) 535,143 C) 563,778 D) $27,333 Answer: B Level: Medium LO: 8 Appendix: 14D 103. When computing the net present value of the project, what is the after-tax caih fow from the salvage value in the final year? A) 528,700 B) $41,000 C) 50 D) 512,300 Answer: A Level: Medium L.O:8 Appendix: 14D 104. The net present value of the project is elosest to: A) $635,299 B) 5647,468 C) $818,544 D) 5806,375