Initial cash flow-year cash flow from project

Reference no: EM13754035

Lion lighting, Inc. is considering a new light bulb manufacturing machine that would cost $100,000 to buy and an additional $5000 to install. Lion lighting would have to maintain a parts inventory as net working capital during the life of the machine that would be sold at the end of the machine's life. The machine would be depreciated to $15000 over its 3-year life and then sold for $45000. The machine is expected to save $35000, $45000 and $55000 in year 1,2and 3, respectively. If lion lighting has a 30% marginal tax rate, what are the initial cash flow and each year's cash flow from the project?

Reference no: EM13754035

Questions Cloud

Development of the primis system for mcgraw-hill : Evaluate which advantages were driving the development of the Primis system for McGraw-Hill. Business customers must perceive that products/services are solutions to their problems. Describe how the Primis system design kept this objective in mind

Balance in the allowance for doubtful accounts : The difference between the balance in Accounts Receivable and the balance in the Allowance for Doubtful Accounts is called the net realizable value.

Distinguishing species : Select one of the six reproductive barriers described in your text. What effects do you think that climate change will have on this particular reproductive barrier? Please use a particular species as an example that hasn't already been covered, in yo..

Initial cash flow-year cash flow from project : The machine is expected to save $35000, $45000 and $55000 in year 1,2and 3, respectively. If lion lighting has a 30% marginal tax rate, what are the initial cash flow and each year's cash flow from the project?

Concepts behind stockholders equity and the transactions : To demonstrate your understanding of the concepts behind stockholders equity and the transactions which support it, read the scenario below and discuss: Al and Ed, friends since childhood, decided to go into business together. They entered into a par..

What is a fossil fuel : what is a fossil fuel

Which could be experienced between different section of line : What does this tell you about the contrasts which could be experienced between different sections of the front line?

Statement of changes in net position and budgetary resources : The Star Exploration Agency, a unit of the Space Department, was established by Congress to begin operations at the beginning of fiscal year 2014. Following are the agency’s transactions during October, its first month of operations:

User Account

All Pages