Question: Question 3, and 4 plz . . Plz show steps too.. thank you You have been asked by the president of your company to evaluate

Question 3, and 4 plz . . Plz show steps too.. thankQuestion 3, and 4 plz . .

Plz show steps too.. thank you

You have been asked by the president of your company to evaluate the proposed acquisition of a special-purpose truck. The truck's basic price is $50, 000, and it will cost another $10, 000 to modify it for special use by your firm. The truck falls in the MACRS 3-year class, and it will be sold after three years for $20, 000. The applicable depreciation rates are 33%, 45%, 15%, and 7%. Use of the truck will require an increase in net operating working capital (spare parts inventory) of $2, 000. The truck will have no effect on revenues, but it is expected to save the firm $20, 000 per year in before-tax operating costs, mainly labor. The firm's marginal tax rate is 40%. What is CFFA at year 0? -$62, 000. -$65, 010. $47, 000. -$50, 000. What is depreciation at year 2? $9, 000. $19, 800. $27, 000. $4, 200. What is CFFA at year 2? $10, 000. $74, 000. $35, 000. $22, 800. What is deprecation tax shield benefit at year 1 ? $19, 800. $7, 920. $30, 000. $10, 800. What is after-tax cost saving at year 1

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