Beta company is considering buying widget fogger

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Beta company is considering buying a widget fogger, It will cost $25000 to purchase and $5000 to install. It will be depreciated SACRS ( 20 % 40 % 15 % 15 % 10 % ) and will last four years before being sold as scrap for $3000. Beta s tax rate is 20 %. the purchase of the fogger will get beta an 8% investment tax credit . a) write the depreciation table and calculate the cash flow from the sale at time 4 . b ) The fogger will enable beta to sell more widgets for higher price and so raise revenue by $ 15000 per year , while raising expenses by $5000 per year . Calculate the cash flow for the project.

Reference no: EM13918050

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