A corporation purchased a machine for $60,000 three years ago. It had an estimated life of 10 years and an estimated salvage value of $9,200. The current BV of this machine in $29,000. If the current MVof the machine is $36,500 and the effective income tax rate is 22%, what is the after-tax investment value of the machine? Use the outsider viewpoint. Choose the correct answer below. A. $28,400 OB. $38.150 OC. $29,680 OD. $34,850 OE $36,500 Gm
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- A manufacturer purchased and installed a shrink-wrap machine 4 years ago at a cost of $4,000. A new machine is now needed, and one is available for $7,000 less a $1,000 trade-in allowance for the old machine. The market value of the old machine without trade-in on a new model is $500. Which of the four dollar values above is a sunk cost that is irrelevant in a pre-tax engineering economic analysis? Group of answer choices $7,000 $1,000 $4,000 $500 Flag question: Question 8Two alternative machines will produce the same product, but one is capable of higher-quality work, which can be expected to return greater revenue. The following are relevant data. Determine which is the better alternative, assuming repeatability and using SL depreciation, an income-tax rate of 30%, and an after-tax MARR of 10%. Calculate the AW value for the Machine A. Capital investment Life Terminal BV (and MV) Annual receipts Annual expenses Click the icon to view the interest and annuity table for discrete compounding when the MARR is 10% per year. AWA (10%) = $ (Round to the nearest dollar.) Machine A $22,000 11 years $5,000 $152,000 $141,000 (...) Machine B $32,000 8 years $500 $190,000 $173,000A firm can purchase a centrifugal separator (5-year MACRS property) for $22,000. The estimated salvage value is $4,000 after a useful life of six years. Operating and maintenance (O&M) costs for the first year are expected to be $2,200. These O&M costs are projected to increase by $1,000 per year each year thereafter. The income tax rate is 24% and the MARR is 11% after taxes. What must the uniform annual benefits be for the purchase of the centrifugal separator to be economical on an after-tax basis?
- Question 2: A new bottle-capping machine costs $45 000, including $5 000 for installation. Operating and maintenance costs are expected to be $3 000 for the first year, increasing by $ 1 000 each year thereafter. The salvage value is calculated by straight-line depreciation where a value of 0 is assumed at the end of the service life. a) Construct a spreadsheet that computes the equivalent annual cost (EAC) for the bottle capper. What is the economic life if the expected service life is 6, 7, 8, 9 or 10 years? Interest is 12%./ b) How sensitive is the economic life to the different length of service life? Construct a sensitivity graph to illustrate this point.The cost of a replacement packaging machine if $95,000. The machine is anticipated to reduce the packaging costs by $20 per parcel. The company expects to send out 25,000 parcels per year. The salvage values of the machine is anticipated to be $23,000 at the end of 10 years. What is the present worth of the machine if the after-tax MARR is 10%, the CCA rate is 20%, and the tax rate is 40%? [Enter your response in $. Round to the nearest full dollar]A corporate expects to receive $36,144 each year for 15 years if a particular project is undertaken. There will be an initial investment of $100,705. The expenses associated with the project are expected to be $7,740 per year. Assume straight-line depreciation, a 15-year useful life, and no salvage value. Use a combined state and federal 48% marginal tax rate, MARR of 8%, determine the project's after-tax net present worth.
- The Shell Corporation has a 34% tax rate and owns a piece of petroleum-drilling equipment that costs $119,000 and will be depreciated at a CCA rate of 30%. Shell will lease the equipment to others and each year receive $33,100 in rent. At the end of five years, the firm will sell the equipment for $31,600. All values are presented in today's dollars. Calculate the overall present worth of these cash flows with tax effects if market interest rate is 10% and annual inflation rate is 2%. (Note: Don't use the $ sign in your answer and round it up to 2 decimal places)A car industry invested $20,000 in cars with a 3-year useful life. The cars will have no salvage value, as the cost to remove it will equal its scrap value. The uniform annual benefits from the cars are $12,000. For a combined 25% income tax rate, and 100% bonus depreciation, compute the after-tax net present worth (NPW) using MARR if 10%.BlastCo Analytics needs to purchase a new metal shaper. BlastCo's after tax MARR is 12% and the corporate tax rate is 54%. A metal shaper is a CCA Class 8 asset. The remaining data are contained in the table below. Model Flex First Cost Economic Life Annual Net (Years) Savings $100,000 5 Blender $120,000 5 Flextastic $200,000 5 $50,000 $55,000 $75,000 Salvage Value $20,000 $25,000 $100,000
- Solve correctly in excel Six years ago, a company purchased $30,000 of equipment. The equipment has just been sold for $5000. The equipment was depreciated using 50% bonus depreciation / 50% MACRS (using a 5-year recovery period). The actual savings due to the purchase of the equipment is shown below. The firm's MARR is 12% and it's tax rate is 25%. What is the after-tax present worth of the investment? Year 1 2 3 4 5 6 Savings 5000 6000 7000 7000 4000 3000The Shell Corp. owns a piece of petroleum drilling equipment that costs $200,000 and will be depreciated by DDB depreciation with B=$200,000, N=10 years, S=$0. There is a combined 50% tax rate. Shell will lease the equipment to others each year and receive $80,000 per year. At the end of 3years, the firm will sell the equipment for $100,000. If the firm requires a 10% after-tax rate of return, what is the PW of the investment?A certain newly created company installed a 10,000kW electric generating plant at a cost of P430 per kW. The estimated life of the plant is 15 years. Salvage value is conservatively set at x% of the first cost. The interest on the sinking fund deposit is 3.5%. The accumulated depreciation after 10 years is P2,483,595. a. What percentage of first cost is set as salvage value? b. How much should the electric generating plant be priced at the end of 8 years? c. If the salvage value is increased by 2%, what is the book value after 10 years?