The Golden Corporation is considering selling one of its old assembly machines. The machine, purchased for $30,000 3 years ago, had an expected life of 6 years and an expected salvage value of zero. Assume Evans uses simplified straight-line depreciation and could sell this machine for $8,000. Also assume Evans has a 34 percent marginal tax rate. What would be the taxes associated with this sale?
Q: Given the information below for HooYah! Corporation, compute the expected share price at the end of…
A: An equity share is a capital market security which gives the investor an ownership interest in the…
Q: Tattletale News Corporation has been growing at a rate of 20% per year, and you expect this growth…
A: The DDM refers to the method of calculation of the value of stock based on the future dividends that…
Q: For an APR of 15% per year, if the interest is compounded weekly, determine the nominal rate per (a)…
A: The nominal interest rate represents the stated rate of interest on a financial product before…
Q: Titan, LLC has a new maintenance cost of $500 at the end of year 1, then $150 at the end of year two…
A: The time value of money is a concept in finance that recognizes the idea that a sum of money has…
Q: Given the information below for Seger Corporation, compute the expected share price at the end of…
A: The amount of cash generated by a business for each outstanding share of its common stock is…
Q: Baghiben
A: The objective of the question is to calculate various financial ratios for a property-casualty…
Q: Mansi Inc. is considering a project that has the following cash flow data. What is the project's…
A: The concept of payback period method is focused upon finding a time period for recovery of initial…
Q: You have just sold your house for $950,000 in cash. Your mortgage was originally a 30-year mortgage…
A: A mortgage refers to a loan obtained to purchase real estate, generally a home. The borrower agrees…
Q: Suppose you are the president of a small, publicly - traded corporation. Since you believe that your…
A: Dear student, kindly check the answer in the explanation box below.Explanation:Dear student, kindly…
Q: If you start making $60 monthly contributions today and continue them for five years, what's their…
A: Present value refers to the current value of an asset that will be present at some future date…
Q: Suppose you want to have $400,000 for retirement in 25 years. Your account earns 5% interest. Feel…
A: Retirement amount = $400,000Number of years = 25Interest rate = 5%To find: a) Monthly deposit, b)…
Q: Suppose there are two independent economic factors, M₁ and M₂. The risk-free rate is 6%, and all…
A: Expected return is frequently used alongside risk metrics like beta or standard deviation. When…
Q: The bond J is a bond with a coupon rate of 4%. The bond K is a bond with a coupon rate of 10%. Both…
A: Bonds are obligation securities issued by governments, districts, or organizations to raise stores,…
Q: Bright Inc. will be receiving $5,400 at the end of every month for the next 3 years. If these…
A: The future value refers to the projected worth of an investment or asset at a specific point in the…
Q: Consider the accompanying cash flow diagram. Compute the equivalent annual worth at i = 8%. $2,000…
A: Equivalent annuity is the annual cash flow having same present value as that of given cash flow…
Q: Bright Inc. will be receiving $5,500 at the end of every month for the next 2 years. If these…
A: The objective of this question is to calculate the future value of a series of monthly payments…
Q: Rate ?? 6.052 6.143 Maturity Month/Year May 32 May 37 May 47 Bid Asked 103.5410 103.5288 104.4900…
A: A bond is a kind of debt security issued by the government and private companies to the public for…
Q: Marston Co is a manufacturing company that wishes to evaluate an investment in new production…
A: Hence, the question has been solved in detailed explanation manner.Explanation:a) Calculating…
Q: The following graph depicts the foreign exchange market for the euro. The demand for euros is…
A: The following is a summarized response; however, for a more thorough explanation, refer to the next…
Q: You observe the following term structure for Treasury bills: Yield (%) 5.1 5.4 5.6 5.8 6.1 Maturity…
A: Treasury securities refer to the debt instruments issued by the U.S. Department of the Treasury to…
Q: what is its current share price?
A: Since you have asked multiple questions, we will solve the first question for you. If you want any…
Q: The following entries (in millions of dollars) are from the balance sheet of Rivendell National Bank…
A: The term "duration gap" typically refers to the difference between the maturities of assets and…
Q: The following table shows the forecast cash flows for two projects: C0 C1 C2 C3 C4 C5 A -$1,050 $25…
A: Internal Rate of Return (IRR)IRR is the rate at which present value of cash inflow equals to present…
Q: General Electric has two bonds outstanding. Both issues have the same credit rating, a face value of…
A: The bonds can be termed as the financial security of debt nature where the tenure for maturity is…
Q: Enter the 3 missing pieces of information. Note: Please make sure your final answer(s) are in…
A: Nominal Interest Rate = ((1 + Periodic Interest Rate)^(1 / Compound) - 1) * CompoundPeriodic…
Q: You have a credit card with an APR of 24.99 %, monthly compounding, that has a balance of $6,600.…
A: Calculations for the original card:Monthly interest rate: Time to pay off debt: It'll take a long…
Q: pls answer the incorrect answers need help!
A: a. Intrinsic Value per Share:We can use the Gordon Growth Model (DDM) to estimate the intrinsic…
Q: Suppose you think AppX stock is going to appreciate substantially in value in the next year. Say the…
A: Stock market:As a dynamic financial marketplace, the stock market allows investors to purchase and…
Q: A 6.05 percent coupon bond with 15 years left to maturity is priced to offer a 7.1 percent yield to…
A: Bonds are debt instruments issued by companies. The issuing company pays periodic coupons or…
Q: deviation of the portfolio? (Round your answer to 1 decimal place.) Residual standard deviation…
A: Portfolio risk analysis involves assessing the potential risk associated with a collection of…
Q: You are thinking about investing $4,619 in your friend's landscaping business. Even though you know…
A: $5,220.00Explanation:You may use the following formula to solve this problem:Present Value = Future…
Q: Apple Bond is currently sold for $1,200 with 10 years to the maturity. The current yield (CY) of…
A: The objective of this question is to find the coupon rate of the bond. The coupon rate is the annual…
Q: (Calculating the geometric and arithmetic average rate of return) The common stock of the Brangus…
A: Stocks or equity in a corporation represents fractional ownership in the organization. The units…
Q: We are evaluating a project that costs $1,180,000, has a life of 10 years, and has no salvage value.…
A: Cost of project $ -11,80,000.00Life of project10 YearsSales (units)59000Price Per Unit $…
Q: You have two monthly car payments of $400 each left on your car. If the interest rate is 0.75…
A: Monthly Payment (PMT) = $400Monthly interest rate (r) = 0.75% or 0.0075Number of periods (n) = 2…
Q: A company is considering purchasing factory equipment that costs $400000 and is estimated to have no…
A: Ratio analysis is a method used to analyze financial statements by calculating and comparing various…
Q: You need a 30-year, fixed-rate mortgage to buy a new home for $210,000. Your mortgage bank will lend…
A: Present value of annuity is computed as follows:-PV= A*wherePV= Present value of annuityA= periodic…
Q: Weston Enterprises is an all-equity firm with two divisions. The soft drink division has an asset…
A: Beta is a measure of the sensitivity of the company's stock compared to its benchmark, it considers…
Q: Which statement is correct? Group of answer choices a. IRR will give you correct decision if it is…
A: The objective of the question is to identify the correct statement among the given options related…
Q: What is the IRR for a $1,075 investment that returns $190 at the end of each of the next 6…
A: Internal rate of return or IRR of a project is the discount rate which makes net present value of…
Q: An online bank is offering to pay 0.25% interest per month on deposits. Your local bank offers to…
A: To compare the interest rates offered by the online bank and the local bank, we need to understand…
Q: McCue Inc.'s bonds currently sell for $1,245. They pay a $80 annual coupon, have a 7-year maturity,…
A: A bond is a kind of debt security issued by the government and private companies to the public for…
Q: What are the prices of a call option and a put option with the following characteristics? (Do not…
A: An option is an agreement between two parties granting one the opportunity to buy or sell a security…
Q: (Expected rate of return and risk) B. J. Gautney Enterprises is evaluating a security. One-year…
A: The expected return of the investment refers to its highly likely occurring return that is computed…
Q: An 8-year maturity zero-coupon bond selling at a yield to maturity of 9% (effective annual yield)…
A: Here, Zero Coupon BondCoupon BondTime to Maturity8Time to Maturity30Yield to Maturity9%Yield to…
Q: TJ Industries has revenue of $400,000 and expenses of $250,000. The depreciation cost is $80,000 and…
A: The objective of the question is to calculate the depreciation tax shield for TJ Industries. The…
Q: A 20-year, 6% quarterly coupon bond with a par value of $10,000 may be called in 5 years at a call…
A: “Since you have posted a question with multiple sub-parts, we will solve first three sub-parts for…
Q: Review the following scenario. Identify how much each lienholder would receive. Mrs. Smith takes out…
A: In the event of foreclosure, lienholders on a property are entitled to receive proceeds from the…
Q: Five years ago, you took out a 5/1 adjustable rate mortgage and the 5-year fixed rate period has…
A: The remaining balance refers to the amount still outstanding after making the principal repayments…
Q: St. John's Hospital has decided to move to a new location to better serve the surrounding community.…
A: Project: Relocating and constructing a new hospital.Project Manager: Judy Kramer.Project…
The Golden Corporation is considering selling one of its old assembly machines. The machine, purchased for $30,000 3 years ago, had an expected life of 6 years and an expected salvage value of zero. Assume Evans uses simplified straight-line
Step by step
Solved in 3 steps with 3 images
- (Capital gains tax) The J. Harris Corporation is considering selling one of its old assembly machines. The machine, purchased for $30,000 5 years ago, had an expected life of 10 years and an expected salvage value of zero. Assume Harris uses simplified straight-line depreciation (depreciation of $3,000 per year) and could sell this old machine for $35,000. Also assume Harris has a 34 percent marginal tax rate. a. What would be the taxes associated with this sale? b. If the old machine were sold for $25,000, what would be the taxes associated with this sale? c. If the old machine were sold for $15,000, what would be the taxes associated with this sale? d. If the old machine were sold for $12,000, what would be the taxes associated with this sale? a. If the old machine were sold for $35,000, there would be $ (...) (Round to the nearest dollar and select from the drop-down menu.)Acefacto Inc., has asked for you to calculate the after-tax salvage value of an asset it plans on using in a construction project. The project will be depreciated straight line to a value of $670,000 at the end of the project's and assets ten year life. Ace's marginal tax rate is 31%. The firm will have to pay $8,802,175 to buy the asset. You have estimated that they could sell the asset for $595,641 to a Brazilian firm at the end of the project. Answer in dollars and cents.Builtrite is considering purchasing a new machine that would cost $60,000 and the machine would be depreciated (straight line) down to $0 over its five year life. At the end of five years it is believed that the machine could be sold for $15,000. The machine would increase EBDT by $42,000 annually. Builtrite’s marginal tax rate is 34%. What is the TCF associated with the purchase of this machine? $5,100 $7,500 $0 $9,900
- Martin Tartans Inc. is considering the purchase of a new argyle sock knitting machine to replace a less automated one. The new machine will cost $220,000 plus $30,000 for shipping and installation. The machine being replaced was purchased five years ago for $140,000 and depreciated as a 7-year MACRS property. It can be sold for $24,000. Martin has a marginal tax rate of 35%. Compute the NINV for the project. Use the rounded MACRS schedule listed below: (7-Year Depreciation Schedule: 14%, 25%, 18%, 12%, 9%, 9%, 9%, 4%)Genesis Corporation want to purchase a piece of machinery for $150,000 that will cost $20,000 to have it delivered and installed. Based on past information, they believe they can sell the machinery for $25,000 in 5 years. The company’s marginal tax rate is 34%. If the applicable CCA rate is 20% and the required return on this project is 15%, what is the present value of the CCA tax shield?Acefacto Inc., has asked for you to calculate the after-tax salvage value of an asset it plans on using in a construction project. The project will be depreciated straight line to a value of$670,000at the end of the project's and assets ten year life. Ace's marginal tax rate is32%. The firm will have to pay$8,047,675to buy the asset. You have estimated that they could sell the asset for$787,309to a Brazilian firm at the end of the project. Answer in dollars and cents.
- Billy Bob's Monster Trucks is considering the purchase of some new vehicles. The total cost for the vehicles is $202,400 and they are to be depreciated straight-line to zero over 10 years. The vehicles will be used for 5 years, after which they can be sold for $25,300. If the relevant tax rate is 30 percent, what is the after-tax cash flow from the sale of this asset? (Do not round your intermediate calculations.) NOTE: Taxes are affected when the asset is sold at either a gain or loss over book value. Multiple Choice O $45,666 $17,710 $48,070 $336,502 $50,474 ↓Daily Enterprises is purchasing a $9.7 million machine. It will cost $54,000 to transport and install the machine. The machine has a depreciable life of 55 years and will have no salvage value. The machine will generate incremental revenues of $4.2 million per year along with incremental costs of $1.1 million per year. If Daily's marginal tax rate is 20%, what are the incremental earnings (net income) associated with the new machine?Daily Enterprises is purchasing a $10.0 million machine. It will cost $50,000 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 $4.0 million per year along with incremental costs of $1.2 million per year. If Daily's marginal tax rate is 21%, what are the incremental earnings (net income) associated with the new machine?
- Daily Enterprises is purchasing a $9.8 million machine. It will cost $47,000 to transport and install the machine. The machine has a depreciable life of 5 years, is using straight-line depreciation, and will have no salvage value. The machine will generate incremental revenues of $3.6 million per year along with incremental costs of $1.12 million per year. Daily's marginal tax rate is 21%. You are forecasting incremental free cash flows for Daily Enterprises. a. If Daily Enterprises decides to use MACRS instead of straight-line depreciation, how would the incremental free cash flows associated with the new machine change? b. Under the TCJA of 2017, Daily Enterprises has the option to take 100% "Bonus" depreciation in the year in which the equipment is put into use. This means that in that year, it would take the full depreciation expense equivalent to the cost of buying the equipment. If Daily does so, which cash flows would increase and which would decrease? How does this compare to…Daily Enterprises is purchasing a $10.3 million machine. It will cost $52,000 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 $4.2 million per year along with incremental costs of $1.2 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 $9.6 million machine. It will cost $45,000 to transport and install the machine. The machine has a depreciable life of 5 years and will have no salvage value. The machine will generate incremental revenues of $4.2 million per year along with incremental costs of $1.2 million per year. If Daily's marginal tax rate is 28%, what are the incremental earnings (net income) associated with the new machine?