Question: Two years ago, Agro, Inc., purchased an ACE generator that cost $250,000. Agro had to pay an additional $50,000 for delivery and installation, and the

Two years ago, Agro, Inc., purchased an ACE generator that cost $250,000. Agro had to pay an additional $50,000 for delivery and installation, and the investment in the generator required the firm to increase its net working capital position by $25,000. The generator, which is being depreciated over a period of five years using straight-line depreciation, has a current market value of $79,550. The firm’s marginal tax rate is 40 percent. If the firm liquidates the asset for its current market value, compute the after tax proceeds from the sale of the asset.

Step by Step Solution

★★★★★

3.49 Rating (172 Votes )

There are 3 Steps involved in it

1 Expert Approved Answer

Step: 1 Unlock

Installed cost of ACE generator Cost 250000 Delivery an... View full answer

Question Has Been Solved by an Expert!

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

Step: 2 Unlock

Step: 3 Unlock

Document Format (1 attachment)

138-B-C-F-C-B (703).docx

120 KBs Word File

Students Have Also Explored These Related Corporate Finance Questions!

Jerry Smith (Problem 3-36) has done some analysis about the profitability of the bicycle shop. If Jerry builds the large bicycle shop, he will earn $60,000 if the market is favorable, but he will...

6. An aerobatic aircraft of 1500lbr is performing a balanced horizontal turn as part of an exhibition at a TAS of 240fts and a rate of turn of 11degs-. Assuming SL conditions a) For the manoeuvre,...

The price of a particular stock over a period of 60 days rises (1) or declines (2) in the following pattern. Research question: At = .05, is the pattern random? + + + + + + + - - + - +- + ++ + + +

Over a period of about 9 months, 1,353 women reported the timing of each of their menstrual cycles. For the first cycle reported by each woman, the mean cycle time was 28.86 days, and the standard...

Two years ago Agro Inc., purchased an ACE generator that cost $350,000. Agro had to pay an additional $60,000 for delivery and installation, and the investment in the generator required the firm to...

Two years ago Agro Inc. purchased an ACE generator that cost $350,000. Agro had to pay an additional $30,000 for delivery and installation, and the investment in the generator required the firm to...

Two years ago Agro Inc., purchased an ACE generator that cost $400,000. Agro had to pay an additional $40,000 for delivery and installation, and the investment in the generator required the firm to...

Two years ago Agro Inc., purchased an ACE generator that cost $ 2 5 0 , 0 0 0 . Agro had to pay an additional $ 3 0 , 0 0 0 for delivery and installation, and the investment in the generator required...

8 . Two years ago Agro Inc., purchased an ACE generator that cost $ 4 0 0 , 0 0 0 . Agro had to pay an additional $ 4 0 , 0 0 0 for delivery and installation, and the investment in the generator...

Two years ago Agro Inc., purchased an ACE generator that cost $400,000. Agro had to pay an additional $20,000 for delivery and installation, and the investment in the generator required the firm to...

QUESTION 4 (Accounting Policies, Changes in Accounting Policies and Errors: IAS 8) (20 marks) Good living Ltd has the following abridged Trial balances for the years ended 30 June 2018 and 2019 Gross...

Major Electronics sells 85,000 personal stereos each year at a price per unit of $55. All sales are on credit: the terms are 3/15, net 40. The discount is taken by 40 percent of the customers.What is...

Question 1 5 ( 1 point ) The Civil war resulted in approximately how many deaths? 2 0 0 , 0 0 0 6 0 0 , 0 0 0 1 . 5 million 7 5 0 , 0 0 0

Compare and contrast Evidence-Based Practice (EBP) to nursing research. What are the similarities and/or the differences between the EBP and research? Explain the role of research as it will pertain...

Miguel is a golfer, and he plays on the same course each week. The following table shows the probability distribution for his score on one particular hole, known as the Water Hole. Score 3 4 5 6 7...

68 85 65 84 65 77 66 65 72 84 73 71 65 65 68 65 76 65 72 76 73 77 65 65 75 65 82 68 85 65 80 85 76 85 72 76 73 77 65 83 65 77 65 68 69 78 71 65 78 Answer: 76 73 77 65 can you explain how to get this...

Considering the ways to define your market, evaluate the situations below using 1 to 5 rating scale, 5 as the highest and 1 as the lowest. Justify your answer in 1 to 2 sentences only. Write your...

If your dreamed business is Stationery Shop(art and gallery business) who are your: Potential market? Target market? Available market? Penetrated market?

Distinguish between a cost centre and a profit centre.

Describe the benefits of holding the following: L01 a. Raw materials inventories b. Work-in-process inventories c. Finished goods inventories

Describe the components of carrying costs. L01

How do ordering costs for items purchased externally differ from ordering costs for items manufactured internally within the firm? L01

Say you own an asset that had a total return last year of 15.5 percent. If the inflation rate last year was 4.5 percent, what was your real return? Multiple Choice 10.53% 10.43% 9.52% 10.63% 10.73%...

Researchers designed an experiment to study the effects of caffeine withdrawal. They recruited 23 volunteers who were diagnosed as being caffeine-dependent to serve as subjects.Each subject was...

Walter receives cash of $18,000 and land with a fair market value of $75,000 (adjusted basis of $50,000) in a current distribution. His basis in his partnership is $16,000. If an amount is zero,...