User Account

All Pages

Calculate the incremental cash inflow after taxes

Assignment Help Financial Accounting
Reference no: EM132519649

The Chelin Company purchased a special machine 1 year ago at a cost of Php12,000. At the time the machine was estimated to have useful life of 6 years and no salvage value. The annual cash operating cost is approximately Php20,000. A new machine has just come on the market which will do the same but with annual cash operating cost of only Php17,000. The new machine costs Php21,000 and has estimated life of 5 years and zero salvage value. The old machine can be sold for Php10,000 to scrap dealer. Straight line depreciation is used, and the company's income tax rate is 40%.

Question 1: Assuming cost of capital is 8% after taxes, calculate:

a) The initial investment

b) The incremental cash inflow after taxes

c) The NPV of new investment

d) The IRR on new investment

Reference no: EM132519649

Questions Cloud

Record both the depreciation values on the equipment : Record both the depreciation values on the Equipment to the date of sale and the calculations to record the sale of the Equipment.
How expect a consideration of information needs of users : How would expect a consideration of information needs of users of financial reports to influence financial reporting? What do consider to be information needs?
Securing differing modes of transportation : Discuss the complexities the U.S. faces when securing differing modes of transportation.
Clandestine methamphetamine laboratory : Would you be more concerned about executing a warrant in a clandestine methamphetamine laboratory or an industrial chemical laboratory? Why?
Calculate the incremental cash inflow after taxes : Assuming cost of capital is 8% after taxes, calculate The incremental cash inflow after taxes, The IRR on new investment, The initial investment
How much dividend should be paid assuming stable dividend : How much dividend should be paid in 2016 assuming stable dividend payout ratio of 25%? stable peso dividend policy is maintained?
Health care industry and economy : Discuss the role of each sector in the health care industry and economy. Discuss the impact of the economic practices of these sectors on industry globally.
Discuss the classification of receivables as current : Classification of receivables as current or non-current is not that important. The money is received eventually anyway, so what's the big deal?'" Discuss.
HI6028 Taxation Theory, Practice & Law Assignment : HI6028 Taxation Theory, Practice & Law Assignment Help and Solution, Holmes Institute - Assessment Writing Service - Identify and critically analyse taxation

Reviews

Write a Review

Financial Accounting Questions & Answers

  Financial statement analysis and preparation

Financial Statement Analysis and Preparation

  Shareholder of a company

Describe the ways that a person can become a shareholder of a company. Why Wal-Mart would split its stock?

  Financial and accounting principles

An understanding of financial and accounting principles can be a valuable tool for managers. While not all managers will find themselves calculating financial ratios or preparing annual financial data.

  Prepare a statement of cash flow using the direct method

Prepare a Statement of Cash Flow using the Direct Method and Prepare the Operations section of the Statement of Cash Flow using the Indirect Method.

  Financial accounting assignment

This assignment has one case study and two question apart from case study. Questions related to document Liquidation question and Company financial statements question - Torquay Limited

  Prepare general journal entries for goela

Prepare general journal entries for Goela Ltd

  Principles of financial accounting

Prepare the journal entry to record the acquisition of the assets.

  Prepare general journal entries to record the transactions

Prepare general journal entries to record the transactions, assuming use of the periodic inventory system

  Global reporting initiative

Compare the view espoused by the economist Milton Friedman about the social responsibilities of business with the views express by Stigler.

  Explain the iasb conceptual frameworks

Explain the IASB Conceptual Framework's perspective of users and their decisions.

  Determine the company''s financial statements

T he focus of the report is to determine the extent to which you are comfortable relying on the financial statements as presented by management .

  Computation of free cash flow

Computation of Free Cash Flow

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

Submit Assignment

Academics

Major Subjects

Majors

Get In Touch

whatsapp: +1-415-670-9521

Phone: +1-415-670-9521

Email: [email protected]

TERMS & POLICIES

HELP & SUPPORT

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd