A company will invest in a machine worth 50000$ to produce a new product. The economic life of the machine is 4 years and its scrap value is 1000$. It will be produced on this machine The annual sales revenue of the product is expected to be 25000 $. Annual operation of the machine Expenditure is expected to be 10000 $. a-) The income tax is 40% and the investment will be made with the company’s equity. Assuming, find the net cash flows that will be generated by purchasing the machine
A company will invest in a machine worth 50000$ to produce a new product. The economic life of the machine is 4 years and its scrap value is 1000$. It will be produced on this machine The annual sales revenue of the product is expected to be 25000 $. Annual operation of the machine Expenditure is expected to be 10000 $. a-) The income tax is 40% and the investment will be made with the company’s equity. Assuming, find the net cash flows that will be generated by purchasing the machine
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
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A company will invest in a machine worth 50000$ to produce a new product. The economic life of the machine is 4 years and its scrap value is 1000$. It will be produced on this machine The annual sales revenue of the product is expected to be 25000 $. Annual operation of the machine Expenditure is expected to be 10000 $.
a-) The income tax is 40% and the investment will be made with the company’s equity. Assuming, find the net
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