A company just bought a new piece of equipment for $4.919million. The followinginformation is given:- after-tax annual interest rate = 17.9%-corporate tax rate = 29%- service life = 24 years- depreciation rate = 20%Calculate the present worth of the equipment's salvage valuewith tax effects.

Part 2: Explanation:Step 1: Calculate Salvage Value:Given that the equipment has a service life of…

Answered: A company just bought a new piece of…

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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A machine now in use was purchased four years ago at a cost of $30,000. It has a book value of $9,369. It can be sold for $12,000, but it could be used for three more years, at the end of which time, it would have no salvage value. What is the current amount of economic depreciation for this asset? Choose from the folowing, $12,000 $18,000 $32,000 $48,000
The Shell Corp. owns a piece of petroleum drilling equipment that costs $200,000 and will be depreciated by DDB depreciation with B=$200,000, N=10 years, S=$0. There is a combined 50% tax rate. Shell will lease the equipment to others each year and receive $80,000 per year. At the end of 3years, the firm will sell the equipment for $100,000. If the firm requires a 10% after-tax rate of return, what is the PW of the investment?
Exerei Dude & Sons have just purchased a machine for $325,000 and an additional $25,000 charge for installation onto a truck for mobility. The expected life is 30 years with a salvage value of 10% of the purchase price. For classical straight-line depreciation determine the first cost, salvage value, annual depreciation amounts and book value after 20 years?
A $150,000 asset has been depreciated with the straight-line method over an 8-year life. The estimated salvage value was $30,000. At the end of the fifth year, the asset was sold for $90,000. From a tax perspective, what is happening at the time of disposal and what is the dollar amount?
A video-recording system was purchased 3 years ago at a cost of $38,000. A 5-year recovery period and DDB (Double Declining Balance) depreciation have been used to write off the basis. The system is to be replaced this year with a trade-in value of $5,500. What is the difference between the book value and the trade-in value? The difference between the book value and the trade-in value is $ .
Give typing answer with explanation and conclusion Chanveida finds a home listed for $48k. Similar homes in good condition sell for $60k (market value). She buys the home and then sells it. Her adjusted cost basis is $44,000, net sell price is $55,000, and overall tax rate is 30%. Assume no financing is used and there is no depreciation taken. Determine Chanveida's Net Profit from sale.
A laboratory centrifuge costs $79,000 and has a $5530 salvage value with an 8-year recovery period. Use the double declining balance method with switch over to straight line to tabulate the depreciation schedule at the end of each year. Remember to not depreciate below salvage.
A new barcode reading device has an installed cost basis of $24,160 and an estimated service life of eight years. It will have a zero salvage value at that time. The 200% declining balance method is used to depreciate this asset. a. What will the depreciation charge be in year eight? b. What is the book value at the end of year seven? c. What is the gain (or loss) on the disposal of the device if it is sold for $3,400 after seven years?
A couple of years ago, the company Health4All purchased land, a building, and two depreciable assets from another corporation. All of these have recently been disposed. Use the information shown to determine the presence and amount of any capital gain, capital loss, or depreciation recapture. Asset Land Building Asset 1 Asset 2 Purchase Price, $ -210,000 -800,000 -50,500 -10,000 Recovery Period, Years 27.5 3 3 Current Book Value, $ 320,000 15,500 5,000 Sales Price, $ 265,000 255,000 21,000 11,500 The capital gain (CG) amount for land is determined to be $ The capital loss (CL) amount for building is determined to be $ The depreciation recapture (DR) amount for asset 1 is determined to be $ The depreciation recapture (DR) amount for asset 2 is determined to be $ The capital gain (CG) amount for asset 2 is determined to be $
Two alternative machines will produce the same product, but one is capable of higher-quality work, which can be expected to return greater revenue. The following are relevant data. Determine which is the better alternative, assuming repeatability and using SL depreciation, an income-tax rate of 30%, and an after-tax MARR of 10%. Calculate the AW value for the Machine A. Capital investment Life Terminal BV (and MV) Annual receipts Annual expenses Click the icon to view the interest and annuity table for discrete compounding when the MARR is 10% per year. AWA (10%) = $ (Round to the nearest dollar.) Machine A $22,000 11 years $5,000 $152,000 $141,000 (...) Machine B $32,000 8 years $500 $190,000 $173,000
An income producing asset costs $50,706 and will be depreciated using Double Declining Balance with a $3,363 salvage value over 9 years. What is the Book Value in year 2?
its practice question Please give me the correct answer and show me the work

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