The after-tax cash flow associated with the sale of equipment is $299,325.
<h3>
What is an initial cost?</h3>
- The initial cost is the typical cost of buying or producing the goods you have on hand.
<h3>
What is an operating cost?</h3>
- Operating costs, often known as operating costs, are the costs associated with running a company, or with running a machine, part, piece of equipment, or facility.
- They represent the cost of the resources an organization uses just to stay in business.
<h3>What is cash flow?</h3>
- The actual or fictitious movement of money is known as cash flow.
- In finance and accounting, cash flow describes the capital inflows and outflows of particular economic units with the aim of achieving a particular goal within a predetermined window of time.
- Making an accurate prediction of future cash flows is required in accounting in addition to measuring current cash flows.
<h3>Solution -</h3>
Revenue of 5 years .
Operating cost of 5 years .
Sale of equipment .
Net profit = .
Tax to be deducted at 25% .
Cash flow after tax .
Therefore, the after-tax cash flow associated with the sale of equipment is $299,325.
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Answer:
7.5%
Explanation:
A forever series formula for the interest rate is i = A / PV
Annual benefits = $75,000
Present value = $1,000,000
Thus, i = $75,000 / $1,000,000
i = 0.075
i = 7.5%
Therefore, the internal rate of return is 7.5%
Answer:
C. Interest Expense for $32,500
interest expense 32,500 debit
premium on BP 2,500 debit
cash 35,000 credit
--to record interest payment--
Explanation:
proceeds: 1,050,000
face value: 1,000,000
premium on BP 50,000
straight line method is used therefore, we amortize the premium equally between payment:
the bond is outstanding for 10 years at 2 payment per year: 20 payment
50,000 / 20 = 2,500
now the cash outlay in favor to the bondholders:
1,000,000 x 7% / 2 = 35,000
The amortization decreasethe interest expense giving a value of 32,500
making option C correct.
Federal tax dollars are collected from citizens to use for programs and infrastructure that is supposed to be used for public good, such as early childhood education, social security, roads, bridges, etc. Since the money is from citizens and for citizens, they should know how the money is spent so they can hold their elected representative accountable.