A company purchased a valuable capital asset three years ago for $8.2 million and it currently has a book value of $6.2 million. The asset is now being sold for $11.6 million.

Q: An asset used in a 4-year project falls in the 5-year MACRS class (refer to MACRS table on page…

A: The objective of the question is to calculate the after-tax salvage value of an asset. The after-tax…

Q: Then, find the NPV of the new investment. (Round present value factor calculations to 5 decimal…

A: NPV means Net Present value.It is a capital budgeting technique used for making investment…

Q: A mining project requires the purchase of new drilling equipment at a cost of $69750.  A further…

A: The objective of the question is to calculate the value of the equipment for depreciation purposes.…

Q: A firm purchased 12-years ago a computerized machine worth P 613,011. As the life of the machine was…

A: Depreciation expense: Depreciation expense is the reduction in a particular asset due to its use or…

Q: A company purchased an asset for $3,700.000 that will be used in a 3-year project. The asset is in…

A: Purchase price of asset =3,700,000Number of years =31-year depreciation =33.33%2-year depreciation…

Q: 8 years ago, a new machine cost $3 million to purchase. The machine was to be linearly depreciated…

A: Depreciation refers to an expense that is incurred each year due to wear, tear or obsolescence…

Q: 2. An electronic computer was purchased by a company for $90,000 and is assumed to have a salvage…

A: Electronic Computer = $90,000 SAlvage Value = $10,000 Years = 10 Depreciation each year = [Cost -…

Q: Freedom Corporation acquired a fixed asset for $230,000. Its estimated life at time of purchase was…

A: The incremental value for depreciation will be the excess amount of depreciation generated from…

Q: Freedom Corporation acquired a fixed asset for $140,000. Its estimated life at time of purchase was…

A: Depreciation is the reduction in the value of asset due to normal wear and tear Effluxion of time.…

Q: What is the initial book value of a new piece of equipment given the following information? Note…

A: Book value refers to the amount of an asset according to the books or accounts as shown in the…

Q: Vandezande Inc. is considering the acquisition of a new machine that costs $428,000 and has a useful…

A: Payback period is defined as the number of years required to recover the original cash investment.…

Q: An automated assembly robot that cost $378,000 has a depreciable life of 5 years with a $80,000…

A: DEPRECIATION EXPENSES Depreciation means gradual decrease in the value of an asset due to normal…

Q: A company buys an industrial lathe for $95,000. It has a useful life of 20 years and a salvage value…

A: Depreciation It is important for the entity to calculate the Depreciation cost to know the actual…

Q: A piece of equipment was purchased for $1, 200 and depreciated on a straight-line basis to $140 over…

A: Under the straight-line method of depreciation, the fixed asset is depreciated with an equal amount…

Q: what is the intrinsic value of the asset after accounting for the cost of illiquidity?

A: Given in the question: Purchase price of the asset = P1,200,000 The value of the asset has been…

Q: 2 Using straight-line depreciation, what is the book value after A years for an asset costing $B…

A: Depreciation expense :— It is the allocation of depreciable cost of asset over the life of asset.…

Q: 2.) A company is considering purchasing a new automated machine that is expected to generate an…

A: A Company is considering of purchasing a new automated machine that is expected to generate…

Q: 2. The purchased price of the equipment is P12,000 and its estimated maintenance costs are P500 for…

A: Purchase price = P 12000 Maintenance cost for first year = P 500 Maintenance cost for second year =…

Q: A company is considering two (2) capital expenditure proposals, X and Y. Both options will generate…

A: The payback period refers to a capital budgeting technique by which the companies analyze the period…

Q: Tiffany bought a piece of equivalent for $40,000. The equipment has a useful life of 5 years and a…

A: In the double declining method the beginning value of the period i.e. is (Value of equipment -…

Q: An asset that costs $97,600 and has accumulated depreciation of $82,000 is sold for $18,000. What…

A: Accumulated Depreciation - The amount of depreciation  that is charged on an asset from the…

Q: An asset purchased today at a cost of $50,000 is depreciated straight-line down to value 0 over a…

A: First we need to calculate book value of an asset after 2 years.Book value = Cost of asset - Total…

Q: Assume that a company is considering buying a new piece of equipment for $250,000 that would have a…

A: Net present value (NPV) is the difference between the current value of cash and the future worth of…

Q: Vandezande Incorporated is considering the acquisition of a new machine that costs $461,000 and has…

A: Payback is a capital budgeting tool which is used to find the time required to recover the invested…

Q: An asset was purchased 7 years ago for $10000. It was estimated to have a 10 year service life and a…

A: Depreciation rate under Declining Balance Method = 1/Useful life           = 1/10            = 10%

Q: Suppose you purchase a tangible asset with a book value of $700,000. The salvage value is $ 100,000.…

A: The total depreciation expense recorded for an asset since its acquisition is known as accumulated…

Q: The Crystal Company uses straight-line depreciation and is considering a capital expenditure for…

A: Annual Depreciation (straight line method) = (Cost of the assets - Residual value) / Expected life…

Q: Billy Hoyle Inc. recently purchased an asset for $2,500,000 that will be used in a 3-year project.…

A:

Q: Assume a situation in which a company has an existing asset, A, that has a current net book value…

A: A firm undertakes a replacement analysis when it wants to figure out whether running the operations…

Q: You bought equipment for $110,000 3 years ago. Today you have an offer to sell your equipment for…

A: The question is based on the concept of depreciation and tax shield for depreciation of machine.

Q: A company has purchased a capital asset for $21.2 million. The asset belongs to the 5-year MACRS GDS…

A:

Q: Assume that a company is considering buying a new piece of equipment for $250,000 that would have a…

A: NPV (Net Present Value) is a financial metric used to evaluate the profitability of an investment by…

Q: Vandezande Incorporated is considering the acquisition of a new machine that costs $470,000 and has…

A: Given: Year Net cash flows 0 -$470,000 1 $156,000 2 $163,000 3 $175,000 4 $160,000 5…

Q: 12.19 Exactly 10 years ago, Boyditch Professional Asso- ciates purchased $100,000 in depreciable…

A: The company will use the assets for many years. Since the assets are used for many years in the…

Q: A company is considering two (2) capital expenditure proposals, X and Y. Both options will generate…

A: Acquisition Cost of X = P 46,000.00 Acquisition Cost of Y = P 46,000.00 Life = 4 Scrap Value =…

Q: a. The book value after five years using straight-line depreciation is $ (Round to the nearest cent…

A: Depreciation is the deduction in the value of fixed asset over the life of the asset. In straight…

Q: Acme is considering the sale of a machine with a book value of $80,000 and 3 years remaining in its…

A: Cash flow is the amount of cash used or generated by the business enterprise at a given point. The…

Q: A construction machine was purchased at a price of $10,000 with a recovery value of $2000 after a…

A: Depreciation is the decrease in the value of assets after using it. Over the period of time, the…

Q: A new machine tool is being purchased for $260,000 and is expected to have a $50,000 salvage value…

A: a) Straight line depreciation is calculated by original cost less depreciation divided by useful…

Q: Stenback, Inc. is evaluating two possible investments in depreciable plant assets. The company uses…

A: Payback period is the time required to recover initial investment made in project.It is computed by…

Q: .Depreciate this asset using straight line depreciation  and declining balance depreciation.

A: 1. Straight-line method: Depreciation p.a. = (Cost - Salvage Value) / Useful life   2. Declining…

Q: A company paid $50,000 for some research equipment, which it believes will have zero salvage value…

A: Book value is described as that value which is ascertained after reducing the accumulated…

Q: Freedom Corporation acquired a fixed asset for $300,000. Its estimated life at time of purchase was…

A: Depreciation is the reduction in the value of asset due tonormal wear and tearEffluxion of…

Q: ears and would have a useful life of 5 years and would have a salvage value of P7,000. For tax…

A: Net present value is the difference between the present value of cash flow and initial investment…

Q: XYZ bought an asset that cost $200,000 at the beginning of the year.  It has a salvage value of…

A: Depreciation refers to the value in terms of money that reduces the original value of an asset…

Production Budget

A budget can be defined as a financial plan designed by an undertaking for a definite period in the future that can contribute towards enhancing the financial success of the business undertaking. It is used to estimate the revenue and expenses. The budget generally takes into account both current and future income and expenses.