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What impact will the cost of the purchase have

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Reference no: EM133029002

Question - Nokela Industries purchases a $40 million cyclo- converter. The cyclo-converter will be depreciated by $10 million per year over 4 years, starting this year. Suppose Nokela's tax rate is 40%.

Required -

A) What impact will the cost of the purchase have on earnings for each of the next years?

B) What impact will the cost of the purchase have on the firm's cash flow for the next four years?

Reference no: EM133029002

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