Question

Presentation Graphics prepares slides and other aids for individuals making presentations. It estimates it can save $42,000 a year in cash operating costs for the next five years if it buys a special-purpose colour-slide workstation at a cost of $90,000.
The workstation qualifies for a capital cost allowance rate of 25%, declining balance, and will have a zero terminal disposal price at the end of year 5. Presentation Graphics has a 12% after-tax required rate of return. Its income tax rate is 40% each year for the next five years.
REQUIRED
Compute
(a) Net present value,
(b) Payback period, and
(c) Internal rate of return.


$1.99
Sales1
Views60
Comments0
  • CreatedJuly 31, 2015
  • Files Included
Post your question
5000