What are the annual cca tax shields for the first five? year

Assignment Help Finance Basics
Reference no: EM132668249

Spherical Manufacturing recently spent $19 million to purchase some equipment used in the manufacture of disk drives. This equipment has a CCA rate of 30% and? Spherical's marginal corporate tax rate is 33%.

a. What are the annual CCA deductions associated with this equipment for the first five? years?

b. What are the annual CCA tax shields for the first five? years?

c. What is the present value of the first five CCA tax shields if the appropriate discount rate is 10% per? year?

d. What is the present value of all the CCA tax shields assuming the equipment is never sold and the appropriate discount rate is 10% per? year?

e. How might your answer to part? (d) change if Spherical anticipates that its marginal corporate tax rate will increase substantially over the next five? years?

a. What are the annual CCA deductions associated with this equipment for the first five? years?

The CCA deduction for year 1 is ?$ ________ (Round to the nearest? dollar.)

Reference no: EM132668249

Questions Cloud

Bond valuation? relationships : The ?-year, ?$ par value bonds of Waco Industries pay percent interest annually. The market price of the bond is ?$?, and the? market's required yield
Discuss attributes of a healthy culture : Discuss attributes of a healthy culture that help individuals or groups perform as a team. Describe qualities of effective communication.
How much can she deduct as a charitable contribution : Assume that Nadia subsequently buys four $100 game tickets. How much can she deduct as a charitable contribution to the university's athletic department
How much may she deduct : Problem - This year, Amy purchased a personal residence at a cost of $1,000,000. How much may she deduct
What are the annual cca tax shields for the first five? year : Spherical Manufacturing recently spent $19 million to purchase some equipment used in the manufacture of disk drives. This equipment has a CCA rate
How analysis of hyper-selectivity dispels the model minority : How analysis of hyper-selectivity dispels the model minority myth by presenting a social constructionist view of race and racial inequality.
How much may she claim as a deduction for state income : Assuming that Norma itemized deductions in 2019, how much may she claim as a deduction for state income taxes on her Federal return for calendar year 2019
Write a curly-arrow mechanism showing how meropenem inhibits : Write a curly-arrow mechanism showing how meropenem inhibits its target enzyme, and explain (using a clear diagram) the molecular basis of the unusually
Men are from mars and women are from venus : Explain the human communication process. His work on information theory investigated how we transmit information.

Reviews

Write a Review

Finance Basics Questions & Answers

  Find end-of-year balance for net operating working capital

The 2015 income statement for Duffy's Pest Control shows that depreciation expense was $200 million, EBIT was $510 million, and the tax rate was 35 percent.

  What are the three most important stock market indexes

In what ways are dividends similar to coupons on bonds? In what ways are dividends different from coupons on bonds?

  How is interest-rate risk a function of a bond maturity

Based on the price changes in response to the changes in yield to maturity, how is interest-rate risk a function of a bond's maturity? That is, is interest-rate risk the same for all four bonds, or does it depend on the bond's maturity?

  The reagan corporation issues 1000 10 year 8 percent

The Reagan Corporation issues 1,000, 10-year, 8%, $1,000 bonds dated January 1, 2014, at 92. The journal entry to record the issuance will show a:

  If a marketing manager uses the task method to budget for

if a marketing manager uses the task method to budget for marketing promotions are competitors promotions spending

  Assume that you have the following information on project a

assume that you have the following information on project a i it will yield cash flows of 960 per year forever ii the

  Calculate the yield to maturity

You are analyzing a bond and want to ensure that you calculate the Yield to Maturity and Yield to Call correctly.

  What is the maximum level of accounts receivable

What is the maximum level of accounts receivable that ALei can carry and have a 35? day average collection? period?

  What is the sustainable growth rate

What is the sustainable growth rate? (Do not round intermediate calculations. Round your answer to 2 decimal places.

  Million and a marginal corporate tax rate

Q Corporation and R Inc. are two companies with very similar characteristics. The only difference between the two companies is that Q Corp.

  Calculate the npv for machine-vandalay industries

Vandalay Industries is considering the purchase of a new machine for the production of latex. Machine A costs $3,096,000 and will last for six years.

  What is the approximate real rate of your reward for saving

Suppose you postpone consumption and invest at 9% when inflation is 3%. What is the approximate real rate of your reward for saving?

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!

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