You invested on a special pizza oven for $60,000 which has a useful operating life of 50,000 hours. The salvage value of this commercial oven is $8,000. What is the depreciation value of this special pizza oven for the first year if it was only used 4,000 hours in its first year?

You invested on a special pizza oven for $60,000 which has a useful operating life of 50,000 hours. The salvage value of this commercial oven is $8,000. What is the depreciation value of this special pizza oven for the first year if it was only used 4,000 hours in its first year?

Name: You invested on a special pizza oven for $60,000 which has a useful op
Uploaded: 2024-03-05T11:50:36.000Z
Channel: Bartleby
Description: You invested on a special pizza oven for $60,000 which has a useful operating life of 50,000 hours. The salvage value of this commercial oven is $8,000. What is the depreciation value of this special pizza oven for the first year if it was only used

EBK CONTEMPORARY FINANCIAL MANAGEMENT

14th Edition

ISBN:9781337514835

Author:MOYER

Publisher:MOYER

Chapter9: Capital Budgeting And Cash Flow Analysis

Section9.A: Depreciation

Problem 1P

See similar textbooks

Similar questions

The Scampini Supplies Company recently purchased a new delivery truck. The new truck cost $22,500, and it is expected to generate net after-tax operating cash flows, including depreciation, of $6,250 per year. The truck has a 5-year expected life. The expected salvage values after tax adjustments for the truck are given here. The company’s cost of capital is 10%. Should the firm operate the truck until the end of its 5-year physical life? If not, then what is its optimal economic life? Would the introduction of salvage values, in addition to operating cash flows, ever reduce the expected NPV and/or IRR of a project?
You invested on a special pizza oven for $60,000 which has a useful operating life of 50,000 hours. The salvage value of this commercial oven is $8,000. What is the depreciation value of this special pizza oven for the first year if it was only used 5,000 hours in its fırst year? a) None of the answers are correct b) Between $3,600 and $3,800 c) Between $6,400 and $6,600 d) Between $5,600 and $5,800 e) Between $4,000 and $4,200 f) Between $5,100 and $5,300
An automated assembly robot that cost $300,000 has a recovery period of five years with an expected $50,000 salvage value. If the MACRS depreciation rates for years 1, 2, and 3 are 20.0%, 32.0%, and 19.2%, respectively, what is the depreciation recapture, capital gain, or capital loss, provided the robot was sold after 3 years for $80,000?
← Daily Enterprises is purchasing a $10.5 million machine. It will cost $55,000 to transport and install the machine. The machine has a depreciable life of five years and will have no salvage value. If Daily uses straight-line depreciation, what are the depreciation expenses associated with this machine? The yearly depreciation expenses are $. (Round to the nearest dollar.)
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. If Daily uses straight-line depreciation, what are the depreciation expenses associated with this machine? The yearly depreciation expenses are $ (Round to the nearest dollar.)
A $25,000 machine that has been used for one year has a salvage value of $16,000 now, which will drop by $4000 per year. The maintenance costs for the next 4 years are $1250, $1450, $1750, and $2250. When the machine is sold, it will cost $2000 to remove and sell. When the machine was purchased, the estimated salvage value in 5 years was $3500. What are the relevant costs for the machine?
Daily Enterprises is purchasing a $9.6 million 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. If Daily uses straight-line depreciation, what are the depreciation expenses associated with this machine? The yearly depreciation expenses are $___________ (Round to the nearest dollar.)
You invested on a special pizza oven for $250,000. This commercial oven is depreciated over a 6-year period, and it is expected to have a $4,000 estimated market value at the end of the 6 years. Using the SOYD method, what is the book value in year 4? a) Between $45,200 and $45,500 b) Between $38,700 and $40,000 c) Between $25,200 and $25,500 d) None of the answers are correct e) Between $28,700 and $29,000 f) Between $35,200 and $35,500
The management of Jasper Equipment Company is planning to purchase a new milling machine that will cost $160,000 installed. The old milling machine has been fully depreciated but can be sold for $15,000. The new machine will be depreciated on a straight-line basis over its 10-year economic life to an estimated salvage value of $10,000. If this milling machine will save Jasper $20,000 a year in production expenses, what are the annual net cash flows associated with the purchase of this machine? Assume a marginal tax rate of 40 percent. a. $15,000 b. $27,000 c. $21,000 d. $18,000
Freida Company is considering an asset replacement project of replacing a control device. This old control device has been fully depreciated but can be sold for $5,000. The new control device, which is more automated, will cost $42,000. The new device’s installation and shipping costs will total $16,000. The new device will be depreciated on a straight-line basis over its 2-year economic life to an estimated salvage value of $0. The actual salvage value of this device at the end of 2-year period (That is, the market value of the device at the end of 2-year period) is estimated to be $4,000. If the replacement project is accepted, Freida will require an initial working capital investment of $2,200 (that is, adding $2,200 initially to its net working capital). During the 1st year of operations, Freida expects its annual revenue to increase from $72,800 to $90,000. After the 1st year, revenues from the replacement are expected to increase at a rate of $2,800 a year for the remainder of…
A machine costs $400,000 with salvage value of 20,000. Life of it is six years. In the first year, 4000 hours; in the second year, 6000 hours and 8000 hours on the third year. The expected flow of the machine is 38000 hours in six years. What is the depreciation at the end of the first year and third year?
You have just bought a new pusher dozer for your equipment fleet. Its cost is $100,000. It has salvage value of $12,000 at the end of its service life. a) Calculate the depreciation using the straight-line method. Show the table with the book value and the depreciation for each year. b) Calculate the depreciation using the DDB method. Show the table with the book value and the depreciation for each year. c) The new pusher dozers $35,000/year for your company during its service life. Determine the tax amount owed at the end of each year if your marginal tax rate is 25% for the income made using this new equipment. Perform this tax calculation separately, once using straight-line depreciation and then using DDB depreciation. d) Based on your calculations for part (c), which depreciation method would you use to file the taxes.