What is the aftertax salvage value of the equipment

Assignment Help Financial Management

Reference no: EM131993708

Kolby’s Korndogs is looking at a new sausage system with an installed cost of $896,000. This cost will be depreciated straight-line to zero over the project’s seven-year life, at the end of which the sausage system can be scrapped for $101,000. The sausage system will save the firm $189,000 per year in pretax operating costs, and the system requires an initial investment in net working capital of $47,000.

What is the aftertax salvage value of the equipment? (Do not round intermediate calculations and round your answer to the nearest whole number, e.g., 32.)

Aftertax salvage value $

What is the annual operating cash flow? (Do not round intermediate calculations and round your answer to the nearest whole number, e.g., 32.)

OCF $

If the tax rate is 30 percent and the discount rate is 6 percent, what is the NPV of this project? (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.)

NPV

Reference no: EM131993708

Questions Cloud

Mitochondria carrying out aerobic respiration : What are the differences in the pH of the medium that occurs when isolated chloroplasts carry out photosynthesis compared to isolated mitochondria carrying out

Result of oxidative phosphorylation : How many high-energy triphosphates are formed by substrate-level phosphorylation during each turn of the TCA cycle?

What is the after tax cash flow from the sale of this asset : If the relevant tax rate is 35%, what is the after tax cash flow from the sale of this asset (after-tax salvage)?

What was upper crusts cash flow from operations for 2008 : Statement of Cash Flows In 2008, Upper Crust had cash flows from investing activities of -$250,000 and cash flows from financing activities of -$150,000.

What is the aftertax salvage value of the equipment : What is the aftertax salvage value of the equipment? What is the annual operating cash flow?

Which stock will have the highest required rate of return : Which stock has the greater risk or is it insufficient information?Which stock will have the highest required rate of return?

Why knowledge of a plant reproductive system : Why knowledge of a plant's reproductive system is important when choosing a breeding strategy.

Should we devote more of our resources treating cancer : Should we devote more of our resources treating cancer or preventing it? Defend your position with evidence.

What is the current price of stagegros stock : If investors' required rate of return is 12%, what is the current price of Stagegro's stock?

User Account

All Pages