Determine the income tax for the year

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Question - Hyundai USA has numerous robotic welders as well as robotic checkers with vision. One underbody robotic welder was installed and is increasing productivity by 2.5% in one area. The result is a savings of $500,000 per year. Deductible expenses other than depreciation and interest associated with the installed robotic welder are only $120,000. Depreciation is $171,480 this year. Interest on borrowed money is $60,500 and no principal is paid back this year.

Required -

a. Determine the taxable income for the year. Show calculations.

b. Determine the income tax for the year assuming a marginal tax rate of 40%.Show calculations.

c. Determine the after tax cash flow for the year. Show calculations.

Reference no: EM133038112

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