A small vessel was purchased by a chemical company for

Reference no: EM13377518

A small vessel was purchased by a chemical company for $55,000 and is to be depreciated by MACRS depreciation. When its requirements changed suddenly, the chemical company leased the vessel to an oil company for 6 years at $10,000 per year. The lease also provided that the vessel could be purchased at the end of 6 years by the oil company for $35,000. At the end of the 6 years, the oil company exercised its option and bought the vessel. The chemical company has a 34% incremental tax rate. Compute its after-tax rate of return on the vessel.

Reference no: EM13377518

Questions Cloud

The depreciation schedule for a machine has been arrived at : the depreciation schedule for a machine has been arrived at by several methods. the estimated salvage value of the

Rolling budgets have the advantage of allowing a company to : rolling budgets have the advantage of allowing a company to adjust its annual forecasts in order to take into account

You are required to identify a public listed corporation in : you are required to identify a public listed corporation in a specified industry as your object of study.i.describe the

Zeon a large profitable corportation is considering adding : zeon a large profitable corportation is considering adding some automatic equipment to its production facilities.an

A small vessel was purchased by a chemical company for : a small vessel was purchased by a chemical company for 55000 and is to be depreciated by macrs depreciation. when its

Prepare entries to record the following transactionsa a : prepare entries to record the following transactionsa a 5000 cash investment made by the owner of a business.b 1700 in

Suppose that a household in a two-period model has income : suppose that a household in a two-period model has income of 30000 in period 1 and 25000 in perod 2 and the interest

The sparklin automotive company sac has been in business : the sparklin automotive company sac has been in business since 1930. it began business in the united states supplying

1 compute the total cost of units transferred out using the : 1. compute the total cost of units transferred out using the weighted-average method.2. compute the total cost of units

User Account

All Pages