Your company, CSUS Inc., is considering a new project whose data are shown below. The required. equipment has a 3-year tax life, and the MACRS depreciation rates for such property are .33, .45, .15, and .07 for Years 1 through 4. Sales and operating costs are expected to be constant over the project's 10-year expected operating life. What is the project's Year 4 operating cash flow? Equipment cost (depreciable basis) $70,000 Sales revenues, each year $40,000 Decrease in sales of existing products $6,500 Operating costs (excl. depr.) $25,000 Tax rate 35.0% $5,864 $7,240 $7,312 $6.154 $8,398
Your company, CSUS Inc., is considering a new project whose data are shown below. The required. equipment has a 3-year tax life, and the MACRS depreciation rates for such property are .33, .45, .15, and .07 for Years 1 through 4. Sales and operating costs are expected to be constant over the project's 10-year expected operating life. What is the project's Year 4 operating cash flow? Equipment cost (depreciable basis) $70,000 Sales revenues, each year $40,000 Decrease in sales of existing products $6,500 Operating costs (excl. depr.) $25,000 Tax rate 35.0% $5,864 $7,240 $7,312 $6.154 $8,398
Glencoe Algebra 1, Student Edition, 9780079039897, 0079039898, 2018
18th Edition
ISBN:9780079039897
Author:Carter
Publisher:Carter
Chapter7: Exponents And Exponential Functions
Section: Chapter Questions
Problem 68SGR
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Question
![Your company, CSUS Inc., is considering a new project whose data are shown below. The required.
equipment has a 3-year tax life, and the MACRS depreciation rates for such property are .33, .45, .15, and
.07 for Years 1 through 4. Sales and operating costs are expected to be constant over the project's 10-year
expected operating life. What is the project's Year 4 operating cash flow?
Equipment cost (depreciable basis)
$70,000
Sales revenues, each year
$40,000
Decrease in sales of existing products
$6,500
Operating costs (excl. depr.)
$25,000
Tax rate
35.0%
$5,864
$7,240
$7,312
$6.154
$8,398](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2Fb5390498-c42a-48dd-a655-e87c44a53cb1%2F58d17f04-0d7a-461b-9519-b99e2878eb57%2F2wac598_processed.jpeg&w=3840&q=75)
Transcribed Image Text:Your company, CSUS Inc., is considering a new project whose data are shown below. The required.
equipment has a 3-year tax life, and the MACRS depreciation rates for such property are .33, .45, .15, and
.07 for Years 1 through 4. Sales and operating costs are expected to be constant over the project's 10-year
expected operating life. What is the project's Year 4 operating cash flow?
Equipment cost (depreciable basis)
$70,000
Sales revenues, each year
$40,000
Decrease in sales of existing products
$6,500
Operating costs (excl. depr.)
$25,000
Tax rate
35.0%
$5,864
$7,240
$7,312
$6.154
$8,398
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