after tax WACC: 10.10% investment related cash flows: invoice price of machinery: $500,000 shipping charges: $35,000 installation cost: $10,000 deprciable basis: $545,000 salvage value: $95,000 investment in net working captial: 20% of next years sales tax rate: 30% depreciation rates: year 1: 0.3333 year 2: 0.4445 year 3: 0.1481 year 4: 0.0741 operating cash flows: projects economic life: 4 years year 1 unit sales: 3,200 units unit growth: 4% year 1 price per unit: $250.00/unit year 1 cost per unit: $185.00/unit inflation rate: 2.5%
after tax WACC: 10.10% investment related cash flows: invoice price of machinery: $500,000 shipping charges: $35,000 installation cost: $10,000 deprciable basis: $545,000 salvage value: $95,000 investment in net working captial: 20% of next years sales tax rate: 30% depreciation rates: year 1: 0.3333 year 2: 0.4445 year 3: 0.1481 year 4: 0.0741 operating cash flows: projects economic life: 4 years year 1 unit sales: 3,200 units unit growth: 4% year 1 price per unit: $250.00/unit year 1 cost per unit: $185.00/unit inflation rate: 2.5%
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
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I need help finding the after tax salvage value, investment in net working capital,
after tax WACC: 10.10%
investment related cash flows:
invoice price of machinery: $500,000
shipping charges: $35,000
installation cost: $10,000
deprciable basis: $545,000
salvage value: $95,000
investment in net working captial: 20% of next years sales
tax rate: 30%
year 1: 0.3333
year 2: 0.4445
year 3: 0.1481
year 4: 0.0741
operating cash flows:
projects economic life: 4 years
year 1 unit sales: 3,200 units
unit growth: 4%
year 1 price per unit: $250.00/unit
year 1 cost per unit: $185.00/unit
inflation rate: 2.5%
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