Reference no: EM133066982
A company in the food/beverage industry is considering purchasing bottling equipment (a special handling device) for $100,000. It estimates the savings associated with the equipment to be $60,000/year.
The annual costs of operating the equipment will be $20,000. The useful life of the equipment is 4 years, after which time its salvage value will be $15,000. The company has a 34% combined income tax rate and uses an after-tax MARR of 12%. For taxation purposes, the bottling equipment can be classified as a Class 39 item (CCA rate = 25%).
a) Calculate the after-tax cash flows for this investment.
b) Using net present worth analysis, determine whether purchasing this equipment would be a wise choice for the company to make
c) Suppose the company sells the equipment at the end of Year 3 for $40,000. Compute the equipment's final book value in Year 3, the depreciation recapture, and the income tax due as a result of the depreciation recapture.
|
Discuss how collaboration tools
: Explain why collaboration information systems are important from the organization's perspective. Discuss how collaboration tools can improve team communication.
|
|
What strategies can you utilise to build your self-awareness
: Identify the leadership styles that are synonymous with emotional intelligence and What strategies can you utilise to build your own self-awareness
|
|
Six new drafters and firing some architects
: You are HR director for a growing architecture firm in Fort Wayne, Indiana, which currently has need of drafting 36 blueprints every hour.
|
|
What is the value of a share of Dell stock
: If Dell's equity cost of capital is 15% and Dell's earnings are expected to grow at a rate of 3% per year, then what is the value of a share of Dell stock
|
|
Calculate the after-tax cash flows for investment
: A company in the food/beverage industry is considering purchasing bottling equipment (a special handling device) for $100,000.
|
|
Ownership-wealth in islam
: Based on the topic above discuss an issue about the trend wealth of people nowadays especially in Malaysia.
|
|
Problems with resilience-self-organization and hierarchy
: Based on your experience and knowledge of the health care organization with which you work, Discuss problems with resilience, self-organization, and hierarchy.
|
|
What enhances new generation currency banknotes
: What enhances new generation currency banknotes?
|
|
Explain adverse selection problem
: Come up with an example of adverse selection, explain why it is an adverse selection problem. Explain why this could lead to "market failure," i.e., why total s
|