Question: [ 1 point ] You purchased a machine for $1.13 million three years ago and have been applying straight-line depreciation to zero for a seven-year
[1 point] You purchased a machine for $1.13 million three years ago and have been applying straight-line depreciation to zero for a seven-year life. Your tax rate is 21%. If you sell the machine today (after three years of depreciation) for $729,000, what is your incremental cash flow from selling the machine?
[1 point] Victoria Enterprises expects earnings before interest and taxes (EBIT) next year of $1 million. Its depreciation and capital expenditures will both be $300,000, and it expects its capital expenditures to always equal its depreciation. Its working capital will increase by $50,000 over the next year. Its tax rate is 25%. If its WACC is 10% and its FCFs are expected to increase at 4% per year in perpetuity, what is its enterprise value?
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