A Corporation expects to receive benefits of $475,000 each year for the first 5 years $550,000 each

Question:

A Corporation expects to receive benefits of $475,000 each year for the first 5 years $550,000 each year for the second 5 years, and $675,000 each year for the third 5 years. There will be an initial investment of $750,000. The Expenses associated with the project are expected to be $17,750 per year. Assume straight-line depreciation a 15-years useful life and a salvage value of $175,000 Use a combined state and federal 37% income tax rate and determine the project’s after tax rate of return.

Salvage Value
Salvage value is the estimated book value of an asset after depreciation is complete, based on what a company expects to receive in exchange for the asset at the end of its useful life. As such, an asset’s estimated salvage value is an important... Corporation
A Corporation is a legal form of business that is separate from its owner. In other words, a corporation is a business or organization formed by a group of people, and its right and liabilities separate from those of the individuals involved. It may...