A company buys a machine for $80,000 that has an expected life of 10 years and no salvage value. The company uses straight-line depreciation. The company anticipates a yearly net income of $3,850 after taxes of 14%, with the cash flows to be received evenly throughout each year. What is the accounting rate of return?   a) 4.81% b) 8.28% c) 1.35% d) 9.63% e) 48.13%

Tipton Corporation has gathered the following data on a proposed investment project (Ignore income taxes.): Investment required in equipment Annual cash inflows Salvage value of equipment Life of the investment Required rate of return O 5 years O 15 years O2 years O 7.143 years $ 30,000 $ 6,000 $0 Chapter 8 15 10 The company uses straight-line depreciation on all equipment. Assume cash flows occur uniformly throughout a year except for the initial investment. The payback period for the investment is: years %

6. A drill press costs $30,000 and is expected to have a 10 year life. The drill press will be depreciated on a straight-line basis over 10 years to a zero estimated salvage value. This machine is expected to reduce the firm's cash operating costs by $4,500 per year. If the firm is in the 40 percent marginal tax bracket, determine the annual net cash flows generated by the drill press.

A firm is considering an investment in new equipment that has the following information. Purchase Cost: $132,793 Salvage Value in five years time: $18,337 Useful life is 5 years and depreciation is determined using the straightline method. Expected increased annual cash flows are $52,651 What is the payback period in years? Calculate to 2 decimal places

This question is based on the following in formation: An investment is Machinery costing P 250,000 with a 4-year life and no salvage value is expected to produce the following net income after taxes of 30%: End of year 1 P 17,000 2 22,000 3 25,000 4 26,000 How much is the annual tax shield?How much is the annual tax shield?A. P 17,580B. P 17,850C. P 18,570D. P 18,750What is the ROI (using the cash income)? A. 6.3%B. 9%C. 31.3%D. 34%

A corporation expects to receive $32,000 each year for 15 years from the sale of a product. There will be an initial investment of $150,000. Manufacturing and sales expenses will be $8067 per year. Assume straight line depreciation, a 15-year useful life and no salvage value. Use a 46% income tax rate. What is the before andafter-tax rate of return? No excel Please and thank you

Most Company has an opportunity to invest in one of two new projects. Project Y requires a $325,000 investment for new machinery with a four-year life and no salvage value. Project Z requires a $325,000 investment for new machinery with a three-year life and no salvage value. The two projects yield the following predicted annual results. The company uses straight-line depreciation, and cash flows occur evenly throughout each year. (PV of $1, FV of $1, PVA of $1, and FVA of $1) (Use appropriate factor(s) from the tables provided.)    Project Y Project Z Sales   $ 370,000     $ 296,000   Expenses                 Direct materials     51,800       37,000   Direct labor     74,000       44,400   Overhead including depreciation     133,200       133,200   Selling and administrative expenses     26,000       26,000   Total expenses     285,000       240,600   Pretax income     85,000       55,400   Income taxes (38%)     32,300       21,052   Net income   $ 52,700     $…

Accounting Rate of Return Each of the following scenarios is independent. Assume that all cash flows are after-tax cash flows. Cobre Company is considering the purchase of new equipment that will speed up the process for extracting copper. The equipment will cost $4,100,000 and have a life of 5 years with no expected salvage value. The expected cash flows associated with the project are as follows: Year   Cash Revenues   Cash Expenses 1   $6,000,000   $4,800,000 2   6,000,000   4,800,000 3   6,000,000   4,800,000 4   6,000,000   4,800,000 5   6,000,000   4,800,000 Emily Hansen is considering investing in one of the following two projects. Either project will require an investment of $75,000. The expected cash revenues minus cash expenses for the two projects follow. Assume each project is depreciable. Year   Project A   Project B 1   $22,500   $22,500 2   30,000   30,000 3   45,000   45,000 4   75,000   22,500 5   75,000   22,500 Suppose that a…

Walton Manufacturing Company has an opportunity to purchase some technologically advanced equipment that will reduce the company's cash outflow for operating expenses by $1,287,000 per year. The cost of the equipment is $5,187,854.53. Walton expects it to have a 9-year useful life and a zero salvage value. The company has established an investment opportunity hurdle rate of 19 percent and uses the straight-line method for depreciation. (PV of $1 and PVA of $1) Note: Use appropriate factor(s) from the tables provided. W Required a. Calculate the internal rate of return of the investment opportunity. Note: Do not round intermediate calculations. b. Indicate whether the investment opportunity should be accepted. a. Internal rate of return b. Should the investment opportunity be accepted? Prev 1 of 15 「買買買 --- MacBook Air Next >

B2B Company is considering the purchase of equipment that would allow the company to add a new product to its line. The equipment costs $360,000 and has a 12-year life and no salvage value. The expected annual income for each year from this equipment follows. Sales of new product Expenses Materials, labor, and overhead (except depreciation) Depreciation-Equipment Selling, general, and administrative expenses Income (a) Compute the annual net cash flow. (b) Compute the payback period. (c) Compute the accounting rate of return for this equipment. Complete this question by entering your answers in the tabs below. Required A Compute the annual net cash flow. Required B Required C Annual Results from Investment Sales of new product Expenses Materials, labor, and overhead (except depreciation) Depreciation Equipment Selling, general, and administrative expenses. Income Net cash flow Income $ 225,000 $ 120,000 30,000 22,500 52,500 $ 225,000 120,000 30,000 22,500 $ 52,500 Cash Flow Flow