Question: Help ASAP Please!! #4 & #5! We are considering buying a widget fogger for $25,000. It will be depreciated according to the SACRS schedule (30%,
We are considering buying a widget fogger for $25,000. It will be depreciated according to the SACRS schedule (30%, 20%, 205, 15%, 15%). We plan to keep it for 4 years and then sell it for $3, 500. Our tax rate is 20%. Construct the depreciation schedule, and calculate the net cash flow from the sale of the machine. A different new machine will cost $20,000 to buy and install and is subject to a 6% investment tax credit. It will help us in two ways. This machine will raise revenues by $3,000 and will save $2, 500 the first year and $5,000 each year after that in costs. What are the after-tax operating cash flows (including the depreciation tax shield) that would result in each year during the six-year life of the new machine? Our tax rate is still 20%. and the depreciation schedule is attached
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