What is the present value of the depreciation tax benefit of the new ship?
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Salvage Co. is considering the purchase of a new ocean-going vessel that could potentially reduce labor costs of its operation by a considerable margin. The new ship would cost P500,000 and would be fully
What is the present value of the depreciation tax benefit of the new ship?
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- Salvage Co. is considering the purchase of a new ocean-going vessel that could potentially reduce labor costs of its operation by a considerable margin. The new ship would cost P500,000 and would be fully depreciated by the straight-line method over 10 years. At the end of 10 years, the ship will have no value and will be sunk in some already polluted harbor. The Salvage Co.'s cost of capital is 12 percent, and its marginal tax rate is 40 percent. The ship produces equal annual labor cost savings over its 10-year life. What is the present value of the depreciation tax benefit of the new ship? (Round to the nearest peso.) P200,000 P169,506 P282,510 P113,004Salvage Co. is considering the purchase of a new ocean-going vessel that could potentially reduce labor costs of its operation by a considerable margin. The new ship would cost P500,000 and would be fully depreciated by the straight-line method over 10 years. At the end of 10 years, the ship will have no value and will be sunk in some already polluted harbor. The Salvage Co.'s cost of capital is 12 percent, and its marginal tax rate is 40 percent. If the ship produces equal annual labor cost savings over its 10-year life, 40. how much is the annual cash inflow of the project should IRR be the same as the cost of capital?Salvage Co. is considering the purchase of a new ocean-going vessel that could potentially reduce labor costs of its operation by a considerable margin. The new ship would cost P500,000 and would be fully depreciated by the straight-line method over 10 years. At the end of 10 years, the ship will have no value and will be sunk in some already polluted harbor. The Salvage Co.'s cost of capital is 12 percent, and its marginal tax rate is 40 percent. If the ship produces equal annual labor cost savings over its 10-year life, 23. what is the present value index of the of the project should IRR be equal to the cost of capital? 28. how much do the annual savings in labor costs need to be to generate a net present value of P0 on the project? (Round to the nearest.) 36. what is the profitability index of the of the project should IRR be equal to the cost of capital?
- Salvage Co. is considering the purchase of a new ocean-going vessel that could potentially reduce labor costs of its operation by a considerable margin. The new ship would cost P500,000 and would be fully depreciated by the straight-line method over 10 years. At the end of 10 years, the ship will have no value and will be sunk in some already polluted harbor. The Salvage Co's cost of capital is 12 percent, and its marginal tax rate is 40 percent. If the ship produces equal annual labor cost savings over its 10-year life, what is the profitability index of the of the project should IRR be equal to the cost of capital?Thomson Media is considering some replacing its equipment. The new equipment will reduce the operating costs by $40,000 every year. It requires initial costs of $80,000 and installation fees of $30,000. The new equipment has a 4-year tax life and would be fully depreciated by the straight-line method, but it would have a salvage value of $25,000 at the end of Year 4, when the project would be closed down. Also, some new working capital of $20,000 would be required, but it would be recovered at the end of the project's life. The old equipment has salvage value of $50,000 today and $18,000 in 4 years. Its book value is $36,000 and gets depreciated by $9,000 every year. The tax rate is 30%, and WACC is 9%. What is the project's NPV?b. Cendrawasih Inc. is considering replacing the equipment it uses to produce crayons. The equipment would cost RM1.37 million, have a 12-year life, and lower manufacturing costs by an estimated RM304,000 a year. The equipment will be depreciated using straight-line depreciation to a book value of zero. The required rate of return is 15 percent and the tax rate is 35 percent. Determine the net income from this proposed project.
- Terry Malloy is trying to decide whether his shipping company should invest in a new boat. The new boat will cost 200,000 USD and it will be fully-depreciated on a straight-line basis over its 10-year useful life. The new boat will have no salvage value. The new boat is expected to increase EBITDA by 50,000 USD per year for 10 years. What is the IRR of this investment if the corporate income tax rate is 50 percent?59 Salvage Co. is considering the purchase of a new ocean-going vessel that could potentially reduce labor costs of its operation by a considerable margin. The new ship would cost P500,000 and would be fully depreciated by the straight-line method over 10 years. At the end of 10 years, the ship will have no value and will be sunk in some already polluted harbor. The Salvage Co.'s cost of capital is 12 percent, and its marginal tax rate is 40 percent. The ship produces equal annual labor cost savings over its 10-year life. What is the present value of the depreciation tax benefit of the new ship? (Round to the nearest peso.) Group of answer choices P113,004 P169,506 P282,510 P200,000Cendrawasih Inc. is considering replacing the equipment it uses to produce crayons. The equipment would cost RM1.37 million, have a 12-year life, and lower manufacturing costs by an estimated RM304,000 a year. The equipment will be depreciated using straight-line depreciation to a book value of zero. The required rate of return is 15 percent and the tax rate is 35 percent. Determine the net income from this proposed project.
- Planet Enterprises is purchasing a $9.6 million machine. It will cost $48,000 to transport and install the machine. The machine has a depreciable life of five years using straight-line depreciation and will have no salvage value. The machine will generate incremental revenues of $4.1 million per year along with incremental costs of $1.1 million per year. Planet's marginal tax rate is 30% . You are forecasting incremental free cash flows for Daily Enterprises. What are the incremental free cash flows associated? The free cash flow for year 0 will be ? The free cash flow for years 1-5 will be ?Daily Enterprises is purchasing a $10.5 million machine. It will cost $55,000 to transport and install the machine. The machine has a depreciable life of five years using straight-line depreciation and will have no salvage value. The machine will generate incremental revenues of $4.2 million per year along with incremental costs of $1.1 million per year. Daily's marginal tax rate is 35%. You are forecasting incremental free cash flows for Daily Enterprises. What are the incremental free cash flows associated with the new machine? The free cash flow for year 0 will be $ nearest dollar.) (Round to theDaily Enterprises is purchasing a $10.4 million machine. It will cost $46,000 to transport and install the machine. The machine has a depreciable life of five years using straight-line depreciation and will have no salvage value. The machine will generate incremental revenues of $4.4 million per year along with incremental costs of $1.5 million per year. Daily's marginal tax rate is 21%. You are forecasting incremental free cash flows for Daily Enterprises. What are the incremental free cash flows associated with the new machine? The free cash flow for year 0 will be $10,446,000. (Round to the nearest dollar.) The free cash flow for years 1-5 will be $ (Round to the nearest dollar.)
