Reference no: EM133061664
Question - J&K Company Limited is considering replacing its current machine with a more technologically advanced machine for the company's use. The company feels that by estimating and analyzing its cash flows it could make a more rational decision about this large purchase. The cash flow estimates for the machine purchase are as follows:
Purchase Price of New Machine $20,500,000
Installation Cost $350,000
Tax Rate 20%
Estimated Receipts from Selling New Machine in 5 years $15,000,000
Current Book Value of Existing Machine $13,000,000
Estimated Receipts from Selling existing machine today $13,500,000
Estimated Receipts from selling existing machine in 5 years $10,000,000
Accumulated Depreciation on new machine in 5 years $5,000,000
Accumulated Depreciation on existing machine in 5 years $4,000,000
a. Calculate J&K Company's After Tax Proceeds from Sale of Existing Asset today.
1. $2,600,000
2. $500,000
3. $13,400,000
4. $10,800,000
b. Calculate J&K's Initial Investment?
1. $20,500,000
2. $7,450,000
3. $20,850,000
4. $7,100,000
c. Calculate J&K's profit/loss from the sale of the existing machine in 5 years.
1. $6,000,000
2. $9,500,000
3. $9,000,000
4. $1,000,000
d. Calculate J&K's Terminal Cash Flow.
1. $5,480,000
2. $5,370,000
3. $4,000,000
4. $5,300,000
|
What amount should Horace Corporation report as inventory
: Merchandise costing $12,000 was being held on consignment by Gotham Company. What amount should Horace Corporation report as inventory
|
|
Advent and sustainment of covid-19 virus
: There have been a lot of challenges that this nation has faced in the many months with the advent and sustainment of the COVID-19 Virus.
|
|
What is the labor spending variance
: One of the company's products is grilled salmon in dill sauce with baby new potatoes and spring vegetables. What is the labor spending variance
|
|
Determine the adjusted cash balance
: Clayborn's May bank statement shows $18,600 on deposit in the bank. Determine the adjusted cash balance
|
|
Calculate J-K profit from the sale of the existing machine
: Accumulated Depreciation on existing machine in 5 years $4,000,000. Calculate J&K's profit/loss from the sale of the existing machine in 5 years
|
|
Effective teamwork relationships among city employees
: What methods may be utilized to build effective teamwork relationships among city employees? How may the city's values and motives help build teamwork?
|
|
What are the dividends per share figure
: Griffins Goat Farm, Inc., has sales of $666,000, costs of $328,000, depreciation expense of $72,000, What are the dividends per share figure
|
|
Determine the company total fixed costs
: ABC Manufacturing produces metal lampposts. The company has no beginning or ending inventories. Determine the company total fixed costs
|
|
Bill of rights
: The Bill of Rights provides protection from unreasonable and arbitrary governmental interference for several civil liberties such as freedom of speech and press
|