Question: Daily Enterprises is purchasing a $5,000,000 machine. The machine will be depreciated using straight-line depreciation over its 5 year life and will have no salvage
Daily Enterprises is purchasing a $5,000,000 machine. The machine will be depreciated using straight-line depreciation over its 5 year life and will have no salvage value. The machine will generate revenues of $8,000,000 per year along with fixed costs of $2,000,000 per year. If Daily's marginal tax rate is 25%, what will be the cash flow in each of years 1 to 5 (the cash flow will be the same each year)? Enter your answer rounded to the nearest whole number. Enter your answer below. 4750000 Correct response: 4,750,0001 If the discount rate is 10%, what is the NPV of the project? The cash flow each year is $4,750,000. Enter your answer rounded to the nearest whole number.
Enter your answer below. 13006237 Correct response: 13,006,237100 Should Daily accept or reject the project (choose one)? Enter your answer below. Accept Reject Correct response: Accept
Find the Net Present value Break-even level of revenues, assuming the costs are all fixed costs. Enter your answer rounded to the nearest whole number.
Please find the Net Present Value Break Even level of revenues
Step by Step Solution
There are 3 Steps involved in it
Get step-by-step solutions from verified subject matter experts
