A manufacturer of aerospace products purchased three flexible assembly cells for $500,000 each. Delivery and insurance charges were $35,000, and installation of the cells cost another $50,000. a. Determine the cost basis of the three cells. b. What is the class life of the cells? c. What is the MACRS-GDS depreciation in year five? d. If the cells are sold to another company for $120,000 each at the end of year six, what is the BV at that time?

A manufacturer of aerospace products purchased three flexible assembly cells for $500,000 each. Delivery and insurance charges were $35,000, and installation of the cells cost another $50,000. a. Determine the cost basis of the three cells. b. What is the class life of the cells? c. What is the MACRS-GDS depreciation in year five? d. If the cells are sold to another company for $120,000 each at the end of year six, what is the BV at that time?

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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