d. The depreciation deduction for year 11 of an asset with a 20-year useful life is $3,600. If the salvage value of the asset was estimated to be zero and straight line depreciation was used to calculate the depreciation deduction for year 11, the initial cost of this asset is most closely equal to which of the following values? (a) $42,000 (b) $67,750 $72,500 (d) $80,000 e. Consider the following data extracted from an After Tax Cash Flow calculation. Before Tax Cash Flow = $22,500 Loan Principal Payment = $7,434 Loan Interest Payment = $892 MACRS Depreciation Deduction = $7,405 Taxes Due = $5,397 Which of the following is closest to the After Tax Cash Flow? (a) $1,372 $8,777 (C) $8,806 (d) $16,211
d. The depreciation deduction for year 11 of an asset with a 20-year useful life is $3,600. If the salvage value of the asset was estimated to be zero and straight line depreciation was used to calculate the depreciation deduction for year 11, the initial cost of this asset is most closely equal to which of the following values? (a) $42,000 (b) $67,750 $72,500 (d) $80,000 e. Consider the following data extracted from an After Tax Cash Flow calculation. Before Tax Cash Flow = $22,500 Loan Principal Payment = $7,434 Loan Interest Payment = $892 MACRS Depreciation Deduction = $7,405 Taxes Due = $5,397 Which of the following is closest to the After Tax Cash Flow? (a) $1,372 $8,777 (C) $8,806 (d) $16,211
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Question
Transcribed Image Text:d. The depreciation deduction for year 11 of an asset with a 20-year useful life is $3,600. If the
salvage value of the asset was estimated to be zero and straight line depreciation was used to
calculate the depreciation deduction for year 11, the initial cost of this asset is most closely equal
to which of the following values?
(a) $42,000
(b) $67,750
$72,500
(d) $80,000
e. Consider the following data extracted from an After Tax Cash Flow calculation.
Before Tax Cash Flow = $22,500
Loan Principal Payment = $7,434
Loan Interest Payment = $892
MACRS Depreciation Deduction = $7,405
Taxes Due = $5,397
Which of the following is closest to the After Tax Cash Flow?
(a) $1,372
$8,777
(c) $8,806
(d) $16,211
Expert Solution
Step 1: Initial Cost:
Since multiple questions have been posted, only the first question will be solved as per the guidelines. To get the other questions resolved, kindly re-post that question.
Initial cost is the amount provided by the buyer to acquire a particular item from the seller. This cost includes all those expenses paid to safely place the asset in its working position.
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