Question: A nine year project involves equipment costing $2,320,000 that will be depreciated using the five-year MACRS schedule. If the estimated pre-tax salvage value for the

A nine year project involves equipment costing $2,320,000 that will be depreciated using the five-year MACRS schedule. If the estimated pre-tax salvage value for the equipment at the end of the project's life is $417,600, what is the after-tax salvage value for the equipment? Assume a marginal tax rate of 21 percent. $329,904 $399,184 O -$6,496 $505,296
A nine year project involves equipment costing $2,320,000 that will be

Anine year project involves equipment costing $2,320,000 that will be depreciated using the five-year MACRS schedule. If the estimated pre-tax salvoge value for the equipment at the end of the project's life is $417,600, what is the after-tax salvage value for the equipment? Assume a marginal tak rate of 21 percent: $329.904 5899,184 .56,496 $505296

Step by Step Solution

There are 3 Steps involved in it

1 Expert Approved Answer
Step: 1 Unlock blur-text-image
Question Has Been Solved by an Expert!

Get step-by-step solutions from verified subject matter experts

Step: 2 Unlock
Step: 3 Unlock

Students Have Also Explored These Related Finance Questions!

Q:

A four year project involves equipment costing $3,050,000 that will be depreciated using the five- year MACRS schedule. If the estimated pre-tax salvage value for the equipment at the end of the...

Q:

A four year project involves equipment costing $3,050,000 that will be depreciated using the five- year MACRS schedule. If the estimated pre-tax salvage value for the equipment at the end of the...

Q:

Question 1 3 pts Winston Corporation is evaluating a new project that will require an increase in accounts receivable of $80,000, an increase in inventory of $250,000, and an increase in accounts...

Q:

MACRS Depreciation Allowances Property Class 3-Year 5-Year Year 7-Year 1 33.33% 20.00% 14.29% 2 44.45 32.00 24.49 3 14.81 17.49 19.20 11.52 4 7.41 12.49 11.52 5 6 8.93 8.92 5.76 7 8.93 8 4.46...

Q:

3. Louie's Leisure Products is considering replacing a project which will require the purchase of $1.4 million in new equipment. The equipment will be depreciated straight-line to a zero book value...

Q:

why do the NPV IRR and payback seem off for this problem? Inputs Taxrate: Variable cost/pound: Fixed cost/year X of NWC of annual sale: Cost of machine Aestoration Cost of the Farm * of Pretax...

Q:

Your family owns a cheese company (CheeseQueen) in Janesville, WI. Its products are sold in southeast Wisconsin. A couple of months ago, your parents were approached by S-Mart (a supermarket chain)...

Q:

MACRS Depreciation Allowances Property Class Year 3-Year 5-Year 7-Year 1 33.33% 20.00% 14.29% 2 44.45 32.00 24.49 3 14.81 19.20 17.49 4 7.41 11.52 12.49 5 11.52 8.93 6 5.76 8.92 7 8.93 8 4.46 An...

Q:

An eight year project involves equipment costing $3,340,000 that will be depreciated using the five-year MACRS schedule. If the estimated pre-tax salvage value for the equipment at the end of the...

Q:

Any help would be appreciated! 1. To take on this contract, CheeseQueen needs to purchase new equipment at the cost of $460,000. The new equipment will be depreciated using a five-year MACRS...

Q:

Effects of fixed and variable cost behavior on the risk and rewards of business opportunities Eastern and Western Universities offer executive training courses to corporate clients. Eastern pays its...

Q:

Show that the translational motion makes the greatest contribution to the internal energy and enthalpy and explain clearly why this is the case. . hco x = kT RTx Evib e* -1, h = 6.626 x 10-34 J s k=...

Q:

You observe two call options, A and B , with the same exercise price, written on the same underlying asset. Option A matures in one year, while B matures in 1 8 months. Which option has the higher...

Q:

Items on Company's Bank Statement The following items may appear on a bank statement: 1. Bank correction of an error from posting another customer's check (disbursement) to the company's account 2....