draw the after-tax cashflow diagram
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Your company has purchased equipment (for $50,000) that will reduce materials and labor costs by $14,000 each year for 10 years. After 10 years, there will be no further need for the machine, and because the machine is specially designed, it will have no MV at any time. The IRS, however, has ruled that you must
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- An in-place machine with B = $155,000 was depreciated by using the Modified Accelerated Cost Recovery System (MACRS) over a 3-year period. The machine was sold for $60,000 at the end of year 2 when the company decided to import the item that required the use of the machine. In year 2, gross income (GI) = $1 million and operating expenses (OE) = $500,000. Determine the tax liability in year 2 if Te = 35%. The tax liability in year 2 is determined to be $ show the steps please(without using excel)Wilcox Corporation won a settlement in a lawsuit and was offered four different payment alternatives by the defendant's insurance company. A review of interest rates indicates that 8% is appropriate for analyzing this situation. Ignoring any tax considerations, which one of the following four alternatives should the controller recommend to Wilcox management? Select one: a. $5,000 now and $20,000 per year at the end of each of the next ten years b. $5,000 now and $5,000 per year at the end of each of the next nine years, plus a lump-sum payment of $200,000 at the end of the tenth year c. $135,000 now d. $40,000 per year at the end of each of the next four years ×You have been asked by the president of your company to evaluate the proposed acquisition of a new special- purpose truck for $70,000. The truck falls into the MACRS 3-year class, is not eligible for either bonus depreciation or Section 179 expensing, and it will be sold after three years for $20,800. Use of the truck will require an increase in NWC (spare parts inventory) of $2 ,800. The truck will have no effect on revenues, but it is expected to save the firm $23,600 per year in before- tax operating costs, mainly labor. The firm's marginal tax rate is 21 percent. What will the cash flows for this project be
- A tax payer is treating real property used solely for business purposes for new real property to be used in his business. The real property originally cost $35,000 and he has taken $18,000 dollars in depreciation. The old real property is currently worth $20,000 dollars and the new real property the taxpayer wants in exchange is only worth $16,500.The other party agrees to get the taxpayer $3500 in addition to the new real property. What is the gain or loss recognized by the taxpayer on this transaction?The Dauten Toy Corporation currently uses an injection molding machine that was purchased prior to the new tax legislation. The machine is being depreciated on a straight- line basis, and it has 6 years of remaining life. Its current book value is $2,400, and it can be sold for $2,600 at this time. Thus, the anual depreciation expense is $2,400/6= $400 per year. If the old machine is not replaced, it can be sold for $500 at the end of its useful life. Dauten offered a replacement machine which has a cost of $10,000, an estimated useful life of 6 years, and an estimated salvage value of $800. The replacement machine is eligible for 100% bonus depreciation at the time of purchase. The replacement machine would permit an output expansion, so sales would arise by $1,000 per year; even so, the new machine's much greater efficiency would cause operating expenses simultaneously increase by $500. Dauten's marginal federal-plus- state tax rate is 25%, and its WACC is 11% What is the NPV of the…April Ltd. is located in Alberta, a province which does not participate in the HST program and has no provincial sales tax. All of its operations are in that province. During its current quarter, April Ltd. purchases an office building and land for a total of $1300000 before GST. The Company spends an additional $266000 (before GST) on office equipment. Office equipment is capital personal property. The building will be used 20% for taxable supplies and the remainder for exempt supplies. The office equipment is to be allocated in the same ratio. For accounting purposes, the building will be amortized over 35 years, while the office equipment will be written off over 5 years. Determine the input tax credits that April Ltd. can claim as a result of these capital expenditures.
- You have been asked by the president of your company to evaluate the proposed acquisition of a new special-purpose truck for $60,000. The truck falls into the MACRS 3-year class, is not eligible for either bonus depreciation or Section 179 expensing, and it will be sold after three years for $20,900. Use of the truck will require an increase in NWC (spare parts inventory) of $2,900. The truck will have no effect on revenues, but it is expected to save the firm $20,300 per year in before-tax operating costs, mainly labor. The firm's marginal tax rate is 21 percent. What will the cash flows for this project be? (Negative amounts should be indicated by a minus sign. Round your answers to 2 decimal places.) Year FCF 0 (62,900.00) Answer is complete but not entirely correct. 2 1 20,195.00 $ 21,707.00 $ 3 38,220.00A mixer was purchased two years ago for $63346 and can be sold for $171667 today. The mixer has been depreciated using the MACRS 5-year recovery period and the firm pays 40 percent taxes on both ordinary income and capital gain. Find the after tax proceeds.At December 31, 2020, Sheridan Corporation has a deferred tax asset of $180,000. After a careful review of all available evidence, it is determined that it is more likely than not that $54,000 of this deferred tax asset will not be realized.Prepare the necessary journal entry. (Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts.) Account Titles and Explanation Debit Credit
- please dont give handwritten answer thnkuYou have been asked by the president of your company to evaluate the proposed acquisition of a new special-purpose truck for $60,000. The truck falls into the MACRS 3-year class, is not eligible for either bonus depreciation or Section 179 expensing, and it will be sold after three years for $20,600. Use of the truck will require an increase in NWC (spare parts inventory) of $2,600. The truck will have no effect on revenues, but it is expected to save the firm $20,200 per year in before-tax operating costs, mainly labor. The firm’s marginal tax rate is 21 percent.What will the cash flows for this project be?You have been asked by the president of your company to evaluate the proposed acquisition of a new special-purpose truck for $60,000. The truck falls into the MACRS 3-year class, is not eligible for either bonus depreciation or Section 179 expensing, and it will be sold after three years for $20,000. Use of the truck will require an increase in NWC (spare parts inventory) of $2,000. The truck will have no effect on revenues, but it is expected to save the firm $20,000 per year in before-tax operating costs, mainly labor. The firm’s marginal tax rate is 21 percent.What will the cash flows for this project be? (Negative amounts should be indicated by a minus sign. Round your answers to 2 decimal places.)
