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Michelle Amabo Company is planning to buy a new machine that can produce additional 20,000 units  of product per year.  The product sells for P50 each.     The cost associated with the product is P30 per unit, exclusive of depreciation on the new machine.  The  new machine which is expected to last for 10 years will cost P500,000.  No salvage value is expected   to be recovered at the end of its life.  The income tax rate is 35%.                                      Required:                    1. Accounting net income            2.     Annual net cash inflows from the new machine.

Michelle Amabo Company is planning to buy a new machine that can produce additional 20,000 units  of product per year.  The product sells for P50 each.     The cost associated with the product is P30 per unit, exclusive of depreciation on the new machine.  The  new machine which is expected to last for 10 years will cost P500,000.  No salvage value is expected   to be recovered at the end of its life.  The income tax rate is 35%.                                      Required:                    1. Accounting net income            2.     Annual net cash inflows from the new machine.

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
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 Michelle Amabo Company is planning to buy a new machine that can produce additional 20,000 units  of product per year.  The product sells for P50 each.     The cost associated with the product is P30 per unit, exclusive of depreciation on the new machine.  The  new machine which is expected to last for 10 years will cost P500,000.  No salvage value is expected   to be recovered at the end of its life.  The income tax rate is 35%.                                     
Required:                   
1. Accounting net income           
2.     Annual net cash inflows from the new machine. 

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