A machine can be purchased for $60,000 and used for five years, yielding the following net incomes. In projecting net incomes,straight-line depreciation is applied using a five-year life and a zero salvage value.Year 1Year 2Year 3Year 4Year 5Net income$3,900$9,900$32,000$14,700$39,600Compute the machine's payback period (ignore taxes). (Round your intermediate calculations to 3 decimal places and roundpayback period answer to 3 decimal places.)YearNet IncomeDepreciationNet Cash FlowCumulative Cash Flow(60,000) $(60,000)1$3,90029,900332,000414,700539,600Payback period

Payback period refers to the time period that is required to recover the initial cost. With the help…

A machine can be purchased for $60,000 and used for five years, yielding the following net incomes. In projecting net incomes, straight-line depreciation is applied using a five-year life and a zero salvage value. Year 3 $32,000 Year 1 Year 2 Year 4 Year 5 Net income $3,900 $9,900 $14,700 $39,600 Compute the machine's payback period (ignore taxes). (Round your intermediate calculations to 3 decimal places and round payback period answer to 3 decimal places.) Year Net Income Depreciation Net Cash Flow Cumulative Cash Flow 2$ (60,000) $ (60,000) 1 $ 3,900 9,900 32,000 4 14,700 39,600 Payback period% =

A machine can be purchased for $60,000 and used for five years, yielding the following net incomes. In projecting net incomes, straight-line depreciation is applied using a five-year life and a zero salvage value. Year 3 $32,000 Year 1 Year 2 Year 4 Year 5 Net income $3,900 $9,900 $14,700 $39,600 Compute the machine's payback period (ignore taxes). (Round your intermediate calculations to 3 decimal places and round payback period answer to 3 decimal places.) Year Net Income Depreciation Net Cash Flow Cumulative Cash Flow 2$ (60,000) $ (60,000) 1 $ 3,900 9,900 32,000 4 14,700 39,600 Payback period% =

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

See similar textbooks

Similar questions

Provide please answer in text Format
Please help me
ss
A 5-year project is estimated to cost $700,000 and have no residual value. If the straight-line depreciation method is used and estimated total income is $231,000, determine the average rate of return giving effect to depreciation on the investment. Round your percentage answer to one decimal place (for example, a value of .1048 rounds to 10.5%).fill in the blank 1 %
To expand its product offerings, BreesCo will be installing $1,849,032 worth of new fixtures. These fixtures will be depreciated straight-line to zero over 4 years. What is the annual depreciation expense associated with these fixtures? (Enter the magnitude of your response rounded to the nearest dollar)
A firm has invested $50,000 in equipment with a 5-year useful life. The machinery will have a salvage value of $5,000. The annual benefits from the machinery are $13,000 for the first year and increase by $2,000 per year. Assume a combined 30% income tax rate, and the firm uses the SOYD depreciation. Calculate the before-tax IRR. Calculate the after-tax IRR.
Two altemnative 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 25%, and an after-tax MARR of 10%. Capital investment Life Machine A $20,000 12 years $3,500 Calculate the AW value for the Machine A. AWA (10%) = $(Round to the nearest dollar.) 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. Machine B $34,000 9 years $2,000 $144,000 $142,000 $190,000 $163,000
Perform a present worth (PW)-based evaluation of the two alternatives below using a spreadsheet. The after-tax minimum acceptable rate of return (MARR) is 8% per year, Modified Accelerated Cost Recovery System (MACRS) depreciation applies, and Te=40%. The (GI -OE) estimate is made for the first 3 years; it is zero in year 4 when each asset is sold. Alternative First Cost, $ Salvage Value, Year 4, $ GI-OE, $ per Year Recovery Period, Years X -8,000 0 3,500 3 Y -13,000 2,000 5,000 3 The PW for alternative X is determined to be $ The PW for alternative Yis determined to be $ Alternative (Click to select) is selected.
please help me, thank you
Please help me to solve this problem
Rework the given problem, assuming the following additional information:• The machine is classified as a seven-year MACRS recovery period. Thetax rate is 40%. and the after-tax MARR is 10%.
Rework the given problem, assuming the following additional information:• The old machine has been fully depreciated.• The new machine will be depreciated under the seven-year MACRS class.• The marginal tax rate is 35%, and the firm's after-tax MARR is 12%.