Foundations Of Finance
10th Edition
ISBN: 9780134897264
Author: KEOWN, Arthur J., Martin, John D., PETTY, J. William
Publisher: Pearson,
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Chapter 11, Problem 4SP
a)
Summary Introduction
To determine: The
b)
Summary Introduction
To determine: The taxes associated with the sales if old machine were sold for $25,000.
c)
Summary Introduction
To determine: The taxes associated with the sales if old machine were sold for $15,000.
d)
Summary Introduction
To determine: The taxes related with the sales if old machine were sold for $12,000.
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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?
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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.
Chapter 11 Solutions
Foundations Of Finance
Ch. 11.A - Prob. 1MCCh. 11.A - Prob. 2MCCh. 11 - Prob. 1RQCh. 11 - Prob. 2RQCh. 11 - If a project requires an additional investment in...Ch. 11 - Prob. 4RQCh. 11 - Prob. 5RQCh. 11 - Prob. 6RQCh. 11 - Prob. 1SPCh. 11 - (Relevant cash flows) Captins Cereal is...
Ch. 11 - Prob. 3SPCh. 11 - Prob. 4SPCh. 11 - Prob. 5SPCh. 11 - Prob. 6SPCh. 11 - Prob. 7SPCh. 11 - Prob. 9SPCh. 11 - Prob. 10SPCh. 11 - Prob. 11SPCh. 11 - Prob. 12SPCh. 11 - Prob. 15SPCh. 11 - (Real options and capital budgeting) You have come...Ch. 11 - (Real options and capital budgeting) Go-Power...Ch. 11 - (Real options and capital budgeting) McDoogals...Ch. 11 - (Risk-adjusted NPV) The Hokie Corporation is...Ch. 11 - (Risk-adjusted discount rates and risk classes)...Ch. 11 - Prob. 1MCCh. 11 - Prob. 2MCCh. 11 - Prob. 3MCCh. 11 - Prob. 7MCCh. 11 - Prob. 8MCCh. 11 - Prob. 9MCCh. 11 - Should the project be accepted? Why or why not?Ch. 11 - Prob. 11MCCh. 11 - Prob. 12MCCh. 11 - Prob. 13MCCh. 11 - Prob. 14MC
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- 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.arrow_forwardGenesis 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?arrow_forward不 Daily Enterprises is purchasing a $10.4 million machine. It will cost $47,000 to transport and install the machine. The machine has a depreciable ife 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 $1.1 million per year. If Daly's marginal tax rate is 35% what are the incremental aming ( income) associated with the new machine? The annual incremental earnings are $ (Round to the nearest dollar)arrow_forward
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