A company purchased an asset for $3,700.000 that will be used in a 3-year project. The asset is in the 3-year MACRS class. The depreciation percentage each yearis 33.33 percent. 44.45 percent, and 14.81 percent, respectively What is the book value of the equipment at the end of the project?Multiple Choice$3.425.830$274,170$2.466,790

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

Answered: A company purchased an asset for…

Essentials Of Investments

11th Edition

ISBN:9781260013924

Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Chapter1: Investments: Background And Issues

Section: Chapter Questions

Problem 1PS

See similar textbooks

Similar questions

Compare three alternatives on the basis of their capitalized costs at i = 14% per year and select the best alternative. Alternative E G First Cost AOC, per Year Salvage Value Life, Years $-75,000 $-490,000 $-990,000 $-50,000 $-20,000 $-9,000 $25,000 $75,000 $750,000 2 00 The capitalized cost of alternative E is $ alternative F is $ and alternative G is $ The best alternative is
Compare three alternatives on the basis of their capitalized costs at i= 13% per year and select the best alternative. Alternative E $-445,000 $-24,000 First Cost $-65,000 $-945,000 $-10,000 AOC, per Year Salvage Value Life, Years $-50,000 $31,000 $81,000 $300,000 The capitalized cost of alternative E is $ alternative F is $ and alternative G is $ The best alternative is (Click to select) v
Problem An asset used in a four-year project falls in the five-year MACRS class for tax purposes. The asset has an acquisition cost of $6,100,000 and will be sold for $1,300,000 at the end of the project. If the tax rate is 27%, what is the after-tax salvage value of the asset? MACRS Depreciation: 2 3 4 5 6 7 8 3 year class 33.33% 44.45% 14.81% 7.41% 5 year class 20.00% 32.00% 19.20% 11.52% 11.52% 5.76% 7 year class 14.29% 24.49% 17.49% 12.49% 8.93% 8.92% 8.93% 4.46%
ABC Healthcare purchases a long term asset for $750,000.00 with an estimated life of 7 years and a scrap value of $150,000. You do not need to show Excel formulas but mathematical formulas in the space provided Instructions: Compute the depreciation under each of the following methods for the first 4 years. Straight Line Year 1 3 4 Depreciation Show formula here DDB Year 1 Depreciation Show formula here 2 3 4 SYD Year 1 Depreciation Show formula here 2 3 4
Electric generating and transmission equigment is placed in service at a cost of $3,250,000. It is expected to last 30 years with a salvage value of $250,000. Click here to access the MACRS-GDS Property Classes Part a Your answer is correct What is the MACRS-GDS property class? 20-Year Property Attempts: 1 of 3 used Part b Determine the depreciation deduction and the unrecovered investment during each of the first 4 tax years. Unrecovered Investment EOY Depreciation Deduction %24 2 3 4. Carry all Interim calculations to 5 decimal places and then round your final answer to the nearest dollar. The tolerance is 100. %24
Problem J: On January 1, 2021, the Reddick Company purchased a mining right for P30,000,000. The mine's recoverable ore reserves are estimated to be 4,000,000 tons. Following the extraction of all ore, the company will be obligated by law to return the land to its original state. The present value of the restoration cost is P2,000,000. The company estimated that the property may be sold for P5,000,000. At a cost of P6,000,000, roads were built and other development costs were invested to aid in the extraction and transportation of the mined ore in early 2021. 200,000 tons of ore were extracted and sold in 2021. A new study conducted by a new mining engineer on December 31, 2022, revealed that 5,000,000 tons of ore were available for mining. 225,000 tons of ore were mined and sold in 2022. How much depletion expense should be recognized in 2022?
Verify the 5- and 7-year property class percentages byapplying the 200% DB approach to a piece of equipmentwith a nominal value of $1,000. For the 7-year propertyclass, in what year is the switch from 200% DB to StraightLine? Only half of the first and last years are considered inthe computations. This means that for a 5-year class property,instead of deducting 100% × (2/5) = 40% in the firstyear, only half (40%/2 = 20%) is deducted.
Qw.25.
Manji
am Warren Company plans to depreciate a new building using the double declining balance depreciation method. The building cost is $780,000. The estimated residual value of the building is $48,000 and it has an expected useful life of 25 years. What is the building's book value at the end of the first year? Grew H Multiple Choice O $717,600 $62,400 $31,200 $33.850 < Prev
• Exel purchased equipment for $100,000 on January 1st, 2020. The equipment will last for 4 years with no salvage value and will be depreciated straight line. On January 1st, 2022, Exel determined the equipment should be revalued +5%, according to IFRS. Depreciation Expense for December 31st, 2022 will be : O $26,250. O $12,000. O $18,000. O $22,000.
Exercise 10-26 (Algo) Research and development [LO10-8] In 2021, Space Technology Company modified its model Z2 satellite to incorporate a new communication device. The company made the following expenditures: Basic research to develop the technology Engineering design work Development of a prototype device Acquisition of equipment Testing and modification of the prototype Legal and other fees for patent application on the new communication system Legal fees for successful defense of the new patent $2,700,000 820,000 440,000 74,000 340,000 54,000 34,000 $4,462,000 Total The equipment will be used on this and other research projects. Depreciation on the equipment for 2021 is $24,000. During your year-end review of the accounts related to intangibles, you discover that the company has capitalized all of the above as costs of the patent. Management contends that the device simply represents an improvement of the existing communication system of the satellite and, therefore, should be…

SEE MORE QUESTIONS

Recommended textbooks for you

Essentials Of Investments

Finance

ISBN:

9781260013924

Author:

Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Publisher:

Mcgraw-hill Education,

FUNDAMENTALS OF CORPORATE FINANCE

Finance

ISBN:

9781260013962

Author:

BREALEY

Publisher:

RENT MCG

Financial Management: Theory & Practice

Finance

ISBN:

9781337909730

Author:

Brigham

Publisher:

Cengage

Essentials Of Investments

Finance

ISBN:

9781260013924

Author:

Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Publisher:

Mcgraw-hill Education,

FUNDAMENTALS OF CORPORATE FINANCE

Finance

ISBN:

9781260013962

Author:

BREALEY

Publisher:

RENT MCG

Financial Management: Theory & Practice

Finance

ISBN:

9781337909730

Author:

Brigham

Publisher:

Cengage

Foundations Of Finance

Finance

ISBN:

9780134897264

Author:

KEOWN, Arthur J., Martin, John D., PETTY, J. William

Publisher:

Pearson,

Fundamentals of Financial Management (MindTap Cou…

Finance

ISBN:

9781337395250

Author:

Eugene F. Brigham, Joel F. Houston

Publisher:

Cengage Learning

Corporate Finance (The Mcgraw-hill/Irwin Series i…

Finance

ISBN:

9780077861759

Author:

Stephen A. Ross Franco Modigliani Professor of Financial Economics Professor, Randolph W Westerfield Robert R. Dockson Deans Chair in Bus. Admin., Jeffrey Jaffe, Bradford D Jordan Professor

Publisher:

McGraw-Hill Education

SEE MORE TEXTBOOKS