What is the book value of the equipment

Assignment Help Financial Management

Reference no: EM132071391

The Jones Company has just completed the third year of a 5-year diminishing value recovery period for a piece of equipment it originally purchased for $ 297 000. The depreciation rate is 40%.

a. What is the book value of the equipment?

b. If Jones sells the equipment today for $ 79 000and its tax rate is 30 %, what is the after-tax cash flow from selling it?

c. Just before it is about to sell the equipment, Jones receives a new order. It can take the new order if it keeps the old equipment. Is there a cost to taking the order and if so, what is it Explain.? (Assume the new order will consume the remainder of the machine's useful life.)

Reference no: EM132071391

Questions Cloud

Calculate the npv of fcf associated with each alternative : Beryl's Iced Tea currently rents a bottling machine for $ 55,000 per year, Calculate the NPV of the FCF associated with each alternative.

What is monthly lease car payment : You receive a $35,000 car LEASE at 6% nominal annual for 60 months. What is your monthly LEASE payment?

What is the market value of this firm : The legal problems are personal and unrelated to the actual business. What is the market value of this firm?

What is the free cashflow for year zero : Planet Enterprises is purchasing a $ 9.5 million machine. What is the free cashflow for year 0 and what is the free cashflow for years 1-5?

What is the book value of the equipment : What is the book value of the equipment? what is the after-tax cash flow from selling it?

What is unique about the way the company is led : Research W.L Gore and develop a 3-5 page paper by answering the following questions: Briefly describe the organization. What makes W.L. Gore successful?

Review of ordering policies for its continuous review system : A company begins a review of ordering policies for its continuous review system by checking the current policies for a sample of items.

How many poodle skirts should swell order before the event : How many Poodle skirts should Swell order before the event? (Note Swell will sell to the backlogged customers for the same price of $75.)

Performance practice-decision-making : 1. Briefly describe the organization. 2. What makes W.L. Gore successful? 3. What is unique about the way the company is led?

User Account

All Pages