Pro bro hero expert Hand written solution is not allowed. encesRequired informationBrooke is evaluating two alternatives for improving the exterior appearance of her Victorian-style house that she isremodeling inside. She plans to keep this as her home for 20 more years. The house can be completely painted at a costof $11,500. The paint is expected to remain attractive for 5 years, at which time repainting will be necessary. Every time thebuilding is repainted (i.e., in years 5, 10, and 15), the cost will increase by 20% over the previous time.As an alternative, the exterior can be covered with a vintage-appearing vinyl-coated siding now and again 10 years fromnow at a cost 31% greater than the present cost of the siding.At a MARR of 10% per year, what is the maximum amount that Brooke should spend now on the siding alternative so that the twoalternatives will just break even? Solve using factors.The maximum amount that Brooke should spend now on the siding alternative is $

Cost of painting = $11500Growth rate of cost = 20%Life of both alternatives = 20 yearsTo find:…

Answered: Required information Brooke is…

CONCEPTS IN FED.TAX.,2020-W/ACCESS

20th Edition

ISBN:9780357110362

Author:Murphy

Publisher:Murphy

Chapter10: Cost Recovery On Property: Depreciation, Depletion, And Amortization

Section: Chapter Questions

Problem 79TPC

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Brooke is evaluating two alternatives for improving the exterior appearance of her Victorian-style house that she is remodeling inside. She plans to keep this as her home for 20 more years. The house can be completely painted at a cost of $16,000. The paint is expected to remain attractive for 5 years, at which time repainting will be necessary. Every time the building is repainted (i.e., in years 5, 10, and 15), the cost will increase by 20% over the previous time. As an alternative, the exterior can be covered with a vintage-appearing vinyl-coated siding now and again 10 years from now at a cost 25% greater than the present cost of the siding. At a MARR of 10% per year, what is the maximum amount that Brooke should spend now on the siding alternative so that the two alternatives will just break even? Solve using factors. The maximum amount that Brooke should spend now on the siding alternative is $ . Note:- Do not provide handwritten solution. Maintain accuracy and quality in…
A new homeowner, Ms. Dee Young, needs to decide whether to install R-11 or R-19 insulation in the attic of her new home. The insulated area is 1,500 square feet. The upgrade from R-11 to R-19 insulation costs $0.05 per square foot. The upgraded insulation is expected to save Ms. Dee Young approximately 420 kilowatt hours of energy usage per year. The planning horizon is 18 years and electricity costs $0.07/kWh. MAR is 10% per year. The future worth of R-19 insulation is $___?
A new homeowner, Ms. Dee Young, needs to decide whether to install R-11 or R-19 insulation in the attic of her new home. The insulated area is 1,600 square feet. The upgrade from R-11 to R-19 insulation costs $0.10 per square foot. The upgraded insulation is expected to save Ms. Dee Young approximately 400 kilowatt hours of energy usage per year. The planning horizon is 23 years and electricity costs $0.09/kWh. MARR is 10% per year. Part a Based on a future worth analysis, is the upgrade to R-19 insulation economically justified? Click here to access the TVM Factor Table Calculator. The future worth of R-19 insulation is $ Carry all interim calculations to 5 decimal places and then round your final answer to 2 decimal places. The tolerance is ±0.15. R-19 insulation ✓attractive.
A new homeowner, Ms. Dee Young, needs to decide whether to install R-11 or R-19 insulation in the attic of her new home. The insulated area is 1,650 square feet. The upgrade from R-11 to R-19 insulation costs $0.10 per square foot. The upgraded insulation is expected to save Ms. Dee Young approximately 350 kilowatt hours of energy usage per year. The planning horizon is 19 years and electricity costs $0.07/kWh. MARR is 12% per year. The future worth of R-19 insulation is $
A new homeowner, Ms. Dee Young, needs to decide whether to install R-11 or R-19 insulation in the attic of her new home. The insulated area is 1,550 square feet. The upgrade from R-11 to R-19 insulation costs $0.05 per square foot. The upgraded insulation is expected to save Ms. Dee Young approximately 440 kilowatt hours of energy usage per year. The planning horizon is 22 years and electricity costs $0.10/kWh. MARR is 11% per year. Based on a future worth analysis, is the upgrade to R-19 insulation economically justified? The future worth of R-19 insulation is $ ? Carry all interim calculations to 5 decimal places and then round your final answer to 2 decimal places. The tolerance is +0.15.
The Parkview Hospital is considering the purchase of a new autoclave. This equipment will cost $159,000. This asset will be depreciated using an MACRS (GDS) recovery period of three years. What is the BV at the end of the second year? Click the icon to view the GDS Recovery Rates (r) for the 3-year property class. Choose the correct answer below. More Info O A. The BV at the end of the second year is $50,880. O B. The BV at the end of the second year is $70,676. GDS Recovery Rates (r) O C. The BV at the end of the second year is $35,330. 3-year Property Class 0.3333 Year O D. The BV at the end of the second year is $106,005. 1 2 0.4445 3 0.1481 0.0741
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You must decide whether to buy, build or lease a building for your business needs over the next 10 years. If you decide to build, you must determine if it is better to buy an existing building and modify it or buy land and build one to match your needs. Leasing an appropriate building will cost $10,000 per month with an annual increase of 3% per year and will require some retrofitting to suit your needs ($700,000). Empty land will cost $2,500,000 and the construction of a new building would be $3,000,000. You can buy an existing building for $2,500,000 but you will have to modify it to your needs at a cost of $1,200,000. However, the building itself is quite old and will be at the end of its useful life when the ten years are up. You estimate that the land alone is worth $2,000,000. There is a municipal election scheduled in the next months. The frontrunner, who has an estimated 70% chance of winning, is prioritizing core services and the environment. If they win, there is a 65% chance…
On April 27, 2020, you purchased for $800,000*** and placed in service a 1940s-vintage residential apartment building. It’s definitely showing its age but your structural engineer assures you that with luck it could last another 12-15 years before reaching the absolute dead-end of its useful life and having to be demolished. *** You actually paid a total of $1M but properly allocated $200,000 to Mother Earth. State and explain your 2020 MACRS depreciation deduction (ignore § 179 and “bonus depreciation”).
On January 2, 2020, you purchased for $950,000*** and placed in service a small 1950s-vintage office building. It’s definitely showing its age but a report from your structural engineer states that it should last another 15 years before reaching the end of its useful life and having to be demolished. *** You actually paid a total of $1.2M to the seller but properly allocated $250,000 to Mother Earth. What is your 2020 MACRS depreciation deduction with respect to this building (not § 179 or “bonus depreciation”)? Explain.
Kenzie purchased a new 3-D printer for $450,000. Although this printer is expected to last for ten years, Kenzie knows the technology will become old quickly and so she plans to replace this printer in three years. At that point, Kenzie believes she will be able to sell the printer for $30,000. Calculate yearly depreciation using the double-declining-balance method.
In five years, Kent Duncan will retire. He is exploring the possibility of opening a self-service car wash. The car wash could be managed in the free time he has available from his regular occupation, and it could be closed easily when he retires. After careful study, Mr. Duncan has determined the following: • A building in which a car wash could be installed is available under a five-year lease at a cost of $3,300 per month. • Purchase and installation costs of equipment would total $126,000. In five years the equipment could be sold for about 10% of its original cost. • An investment of an additional $9,500 would be required to cover working capital needs for cleaning supplies, change funds, and so forth. After five years, this working capital would be released for investment elsewhere. • Both a wash and a vacuum service would be offered with a wash costing $1.53 and the vacuum costing $0.85 per use. • The only variable costs associated with the operation would be 7.5 cents per wash…

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