A tax duty free importation of a 30HP sandmill for paint manufacturing cost P360,000. Bank charges arrastre and brokerage cost P5,000. Foundation and installation costs were P25,000. Other incidental expenses amount to P20,000. Salvage value of the mill is estimated to be P60,000 after 20 years. Find the appraisal value of the mill using SLM at the end of 10 years. 4.
Q: A car industry invested $20,000 in cars with a 3-year useful life. The cars will have no salvage…
A: Net Present Worth, or NPW, refers to the difference between present worth of cash inflows and the…
Q: SHOW ALL SOLUTIONS. 1. An investment of P60,000.00 can be made in depreciable assets that will…
A: Investment amount = P60000 Revenue = P29000 each year for 5 years Maintenance cost = P12000 per year…
Q: 000 at the end of its life o
A: I have used other method staright line method
Q: estimated at 15 years and salvage value is 5%. At present, abandoning the old plant in favor of…
A: Depreciation in economic aspects is a proportion of how much worth a resource loses from compelling…
Q: Daily Enterprises is purchasing a $9.8 million machine. It will cost $55,000 to transport and…
A: The term depreciation refers to an accounting method used to allocate the cost of a tangible or…
Q: A project capitalized for ₱37,000 invested in depreciable assets will earn a uniform, annual income…
A: Capitalized Cost 37000 Annual Income 23209 Annual Cost 9000 Tax and insurance 4% of…
Q: Which of the following is NOT a valid valuation method for tax purposes: Select one: Special…
A: A taxpayer adopting the Last in First out (LIFO) approach for tax reasons must typically utilise the…
Q: A broadcasting corporation was formed duly approved by the Securities and Exchange Commission has a…
A: The redemption period is defined as the period during which the value of the initial investment is…
Q: A machine has a first cost of P113,222.48 and has an expected salvage value after 10 years…
A: Machines and equipment lose some of their value over time due to wear and tear. Depreciation…
Q: An industrial plant bought a generator set for P120, 000. Other expenses including installation…
A: The sum of years' digits technique is a type of accelerated depreciation expense that is based on…
Q: An engineer bought equipment for P500,000. HE spent an additional amount of P30,000 for installation…
A: According to question, it is given that Price of equipment = 500,000 Additional amount = 30,000…
Q: A buffing machine is costs P10,000. Its estimated scrap value is P1,000 after 9 years. Solve for the…
A: Given; Cost of machine= P10000 Estimated scrap value= P1000 Years= 9 years Interest rate= 6%
Q: An investment of $1.000.000 will be included in the 7-year MACRS class for depreciation. It would…
A:
Q: A contractor is considering the purchase of a set of machine tools at a cost of $50,000. The…
A: Present worth represent the value of asset or any goods and services after the depreciation and the…
Q: A new machine is to be purchased for $200,000. The company believes it will generate $75,000…
A: A firm might compare a project's IRR to the hurdle rate or the lowest allowable return to decide…
Q: Problem 17.051: Calculate the after-tax PW of two alternatives Perform a present worth (PW)-based…
A: Present-worth (PW) based evaluation is one of the ways for evaluating a group of options using…
Q: 3. A factory is constructed at a first cost of P8,000,000 and with an estimated salvage value of…
A: The sinking fund method is a depreciation method for financing the replacement of an asset after its…
Q: An organization completes the purchase of new asset at a cost of $25,000. It has an yearly operating…
A: To find the annual savings which would provided rate of return of 10% , we will find the present…
Q: Certain new machinery used in manufacturing of motor vehicles, when placed in service, is estimated…
A: Present Worth is defined as the method which is used to calculate future cashflows Given, Cost of…
Q: Your firm is planning to install a new capping machine at the apple juice factory. This machine is…
A: Initial Cost = $500,000 Net Income = $150,000 for 4 years Salvage Value = $75,000 Federal tax rate =…
Q: A businessman is considering the purchase of a machine that is expected to be obsolete in 5 years.…
A: Given: Cost of machine=P 100,000 Interest rate=15% Income: Year 1=20000, Year 2=25000, Year 3=35000,…
Q: Your firm is planning to install a new capping machine at the apple juice factory. This machine is…
A: Annual worth or AW is referred to as the easy way of understanding the annual amount, for instance,…
Q: at cost P90,000 will have an estimated salvage value of P18,000 at the end of 8 years. Using…
A: Given Equipment cost = 90000 P salvage value = 18000 P Life of asset = 8 years Depreciation = Fixed…
Q: Consider the following abbreviated financial statements for a proposed investment Years Sales Costs…
A: Accounting rate of return = [Average annual profit / Initial investment] * 100 Average annual profit…
Q: A small print shop is investing in new printing equipment that will cost $30,000. They estimate that…
A: Given that :- New printing equipment cost $30,000 Additional revenues for every of the next 6 years…
Q: A project requires an initial investment of BD .1 80,000, has a salvage value of BD 10,000 after 3…
A: Given that; Initial investment= BD 180000 Annual expenses=BD2000 Salvage value=BD 10000 Life(n) =3…
Q: wo fadures are being considered for a particular job in a manufacturing firm. The pertinent data for…
A: Given information Fixture X Capital investment= $35000 Annual cost=$6000 Useful life=6 years Market…
Q: A small print shop is investing in new printing equipment that will cost $30,000. They estimate that…
A: Answer; Given that :- A small print shop is investing in new printing equipment that…
Q: installation, amounted to P30,000. At the end of its estimated useful life of 10 years, the salvage…
A: Book value is the value of an asset according to its balance sheet account balance. For assets, the…
Q: An asset for drilling was purchased and placed in service by a petroleum production company. Its…
A: Straight line (SL) method is charging same amount of depreciation each year. 200 % Declining balance…
Q: A firm must decide between two designs. Their effective income tax rate is 15%, and MACRS…
A: The annual worth or AW method refers to the value for an alternative, comprising of two prime…
Q: A firm must decide between two designs. Their effective income tax rate is 15%, and MACRS…
A: Annual worth or AW is referred to as the easy way of understanding the annual amount, for instance,…
Q: firm can purchase a centrifugal separator (5-year MACRS property) for $22,000. The estimated…
A: Given data, Investment 22000 Life 6 years Salvage value 4000 Tax rate 24% MARR 11%
Q: A machine costing P45.000 is estimated to have a salvage value of P4,350 when retired attheendof6…
A: Answer: Given that: A machine costing P45,000 is estimated to have a salvage value of P4,350…
Q: A small print shop is investing in new printing equipment that will cost $42,000. They estimate that…
A: Given information Initial investment=42000 Annual revenue=14000 Salvage value=3000 Tax rate=27%…
Q: An asset for drilling was purchased and placed in service by a petroleum production company. Its…
A: Answer is in 2nd step:
Q: Approximate the after-tax ROR on a project that had a first cost of $500,000, a salvage value of 19%…
A: The correct answer is given in the second step.
Q: A P110,000 chemical plant had an estimated life of 6 years. and a projected scrap value of P10,000.…
A: cost = 110,000 life = 6 years scrap value = 10,000
Q: pecial tools for the manufacture of finished product costs 20,000 and have salvage value of 2,000 at…
A: Given product cost = 20000 salvage = 2000 time = 3 years Depreciation = Sum of Year digit method
Q: Weber Drilling Company is considering investing $20M in oil and gas drilling equipment. It is…
A: The present value of cash flows at the needed rate of return on your project relative to your…
Q: An asset that is book-depreciated over a 5-year period by the straight line method has ??3 = $62,000…
A: Given: BV3=$62000 Depreciation=$26000 Period=5 years To find: First Cost Assumed salvage value
Q: A small pump costs $24,000 and has a life of 8 years and a $1,400 SV at that time. If the 150% DB…
A: Pump cost =24000 $ time = 8 years Salvage value = 1400 $ DB method = 150 %
Q: A certain newly created company installed a 10,000kW electric generating plant at a cost of P430 per…
A: Given Workings:- Cost of asset = 10,000 KW * 430 P = P43,00,000 Life of asset = 15years Salvage…
Q: The Philippine Society of Mechanical Engineers is planning to construct its own building. Two…
A: For Case (a):-P = 400,000 = PrincipalI = 20%Time = 5 yearsn = number of times compounding = 1∴ after…
Q: depreciation expense of $51178, and additions to retained eanings of $69054. The firm currently has…
A: Times interest earned or interest coverage ratio is a measure of a company's ability to honor its…
Q: A corporate expects to receive $36,144 each year for 15 years if a particular project is undertaken.…
A: The difference between the present value of cash inflows and the present value of cash outflows over…
Q: The effective combined tax rate in a firm is 28%. An outlay of $2 million for certain new assets is…
A: Effective combined tax rate =28%$2 million of outlay for new assetsAnnual receipts of $650,000 for 9…
Step by step
Solved in 2 steps
- A new machine costs $899,090 and falls in a 29.50% CCA class. The machine will have zero value after 5 years of use but will save $417,680 annually in operating costs before taxes in those five years. Assume a tax rate of 34.17%. Using a required return of 15.11%, what is the equivalent annual cost (EAC) of the machine purchase, considering the annual cash flow, initial purchase, and CCA tax shield? Options $59,682 $61,252 $62,823 $64,393 $65,964heavy equipment for a certain project and the details are as follows: ITEM: MACHINE A: MACHINE B: First Cost P2,000,000.00 P3,000,000.00 Annual operating P325,000.00 P250,000.00 cost Annual labor cost Insurance and taxes Payroll taxes Estimated life P500,000.00 P320,000.00 4% 10% 12 yrs. 4% 10% 12 yrs. If the minimum ROR is 25%, What is the annual cost of Machine A & B using present worth method?New-Project Analysis The Campbell Company is considering adding a robotic paint sprayer to its production line. The sprayer's base price is $830,000, and it would cost another $22,500 to install it. The machine falls into the MACRS 3-year class, and it would be sold after 3 years for $485,000. The MACRS rates for the first three years are 0.3333, 0.4445, and 0.1481. The machine would require an increase in net working capital (inventory) of $17,500. The sprayer would not change revenues, but it is expected to save the firm $351,000 per year in before-tax operating costs, mainly labor. Campbell's marginal tax rate is 25%. (Ignore the half-year convention for the straight-line method.) Cash outflows, if any, should be indicated by a minus sign. Do not round intermediate calculations. Round your answers to the nearest dollar. What is the Year-0 net cash flow? $ What are the net operating cash flows in Years 1, 2, and 3? Year 1: $ Year 2: $ Year 3: $ What…
- (Chapter 13) A $20,000 machine will be purchased by a company with an MARR of 10%. It will cost $5,000 to install and removal costs are insignificant. What is its economic life and minimum EUAC cost given the following O&M costs: YR, n 1 2 3 4 5 O&M $5,000 $8,000 $11,000 $14,000 $17,000You are evaluating two different silicon wafer milling machines. The Techron | costs $264,000, has a 3-year life, and has pretax operating costs of $71,000 per year. The Techron Il costs $460,000, has a 5-year life, and has pretax operating costs of $44,000 per year. For both milling machines, use straight-line depreciation to zero over the project's life and assume a salvage value of $48,000. If your tax rate is 22 percent and your discount rate is 12 percent, compute the EAC for both machines. (A negative answer should be indicated by a minus sign. Do not round intermediate calculations and round your answers to 2 decimal places, e.g., 32.16.) > Answer is complete but not entirely correct. Techron I $ -134,840.83 Techron II $ -107,570.18Engineering Taylan bought a piece of land with an area of 2,000 sq m. worth P1,000,000.00. He gave a 30% downpayment and the balance to be paid for 10 years with the following terms: 1. P50,000 to be paid at the beginning of the 3rd yr. 2. P100,000 to be paid at the beginning of the 6th yr. 3. The last payment to be paid at the end of the 10th year. If i= 6% compounded quarterly, how much is his last payment?
- 11:36 00 VOLTE 76% expert.chegg.com/qna/auth Chegg Hide student question Time Left: 01:51:59 A 8 ✓ Student question A machine has a first cost of $24,000. Its market value declines by 20% annually. The repair costs are covered by the warranty in Year 1, and then they increase $900 per year. The firm's MARR is 12%. Find the minimum EUAC for this machine and its economic life. Skip G Exit Σ Q 2 Submit ... Traininguppose that you purchased a HVAC system five years ago for $75, 000. The O&Mcosts are $15, 000 this year and are expected to increase by $1, 000 each year for the next five yearsthen remain the same for the following years.The current salvage value of the system is $15, 000; salvage value after one year is estimated tobe $12, 000; after two years, $11, 000; after three years, $10, 000; after four years, $9, 000; and so on.A new industrial HVAC system is available for purchase at a price of $95, 000, including instal-lation. The market value of the new system will decrease at a rate of 15% each year. The O&Mcosts are expected to be $1, 000 in the first year, and will increase at a rate of 20% each year. Themaximum service life of the new system is 10 years. Assume that your company uses an interestrate of 10% for all project evaluations.(a) Find the remaining economic life of the currently owned asset.(b) What is the economic service life of the new system?(c) Use the…Allen Construction purchased a crane 6 years ago for $130,000. They need a crane of this capacity for the next 5 years. Normal operation costs $35,000 per year. The current crane will have no salvage value at the end of 5 more years. Allen can trade in the current crane for its market value of $40,000 toward the purchase of a new one, which costs $150,000. The new crane will cost only $8,000 per year under normal operating conditions and will have a salvage value of $55,000 after 5 years. If MARR is 20%, determine which option is preferred. a) Use cash flow approach (insider's viewpoint approach) b) Use the opportunity cost approach (outsider's viewpoint approach)
- date period In Santa Barbara, the sales tax is 7.55%. What would be the final cost of a surfboard if it was being sold for $1,200 ?A specialty concrete mixer used in construction was purchased for $300,000 7 years ago. Its annual O&M costs are $105,000. At the end of the 8-year planning horizon, the mixer will have a salvage value of $5,000. If the mixer is replaced, a new mixer will require an initial investment of $375,000. At the end of the 8-year planning horizon, it will have a salvage value of $45,000. Its annual O&M cost will be only $40,000 due to newer technology. Analyze this using an EUAC measure and a MARR of 15 percent to see if the concrete mixer should be replaced if the old mixer is sold for its market value of $65,000. a. Use the cash flow approach (insider’s viewpoint approach) b. use the opportunity cost approach (outsiders viewpoint approach) Include formulas in excel screen shots.A tractor costs $24,680, has an expected life of 12 years, and has a salvage value of $2,600. Use straight-line depreciation to find the yearly depreciation. Make a depreciation schedule for the first three years' depreciation. Complete the table. Year Depreciation 1 $ 2 3 $ $ Accumulated depreciation $ $ $ End-of-year book value $ $