Daily Enterprises is purchasing a $10.5million machine. It will cost $46,000 to transport and install the machine. The machine has a depreciable life of five years and will have no salvage value. The machine will generate incremental revenues of $4.3 million per year along with incremental costs of $1.5 million per year. If Daily's marginal tax rate is 21%, what are the incremental earnings (net income) associated with the new machine? The annual incremental earnings are $_____________________ (Round to the nearest dollar.)
Daily Enterprises is purchasing a $10.5million machine. It will cost $46,000 to transport and install the machine. The machine has a depreciable life of five years and will have no salvage value. The machine will generate incremental revenues of $4.3 million per year along with incremental costs of $1.5 million per year. If Daily's marginal tax rate is 21%, what are the incremental earnings (net income) associated with the new machine? The annual incremental earnings are $_____________________ (Round to the nearest dollar.)
Chapter2: The Domestic And International Financial Marketplace
Section2.A: Taxes
Problem 7P
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Daily Enterprises is purchasing a $10.5million machine. It will cost
$46,000 to transport and install the machine. The machine has a depreciable life of five years and will have no salvage value. The machine will generate incremental revenues of $4.3 million per year along with incremental costs of $1.5 million per year. If Daily's marginal tax rate is 21%, what are the incremental earnings (net income) associated with the new machine?
The annual incremental earnings are $_____________________
(Round to the nearest dollar.)
(Round to the nearest dollar.)
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