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tino4ka555 [31]
3 years ago
14

Canyon Buff Corp. is considering the purchase of a new piece of equipment which would cost $11,000. This equipment will have a f

ive-year useful life and have a salvage value of $1,000 at the end of the five-year period. The marginal tax rate is 30% and the average tax rate is 20%. Assume a straight-line depreciation, the net effect of annual depreciation on the free cash flow is $_____ in each of the 5 years.
Business
1 answer:
Furkat [3]3 years ago
5 0

Answer:

Tax shield on depreciation = 600

Explanation:

given data

new piece of equipment = $11,000

salvage value = $1,000

marginal tax rate = 30%

average tax rate = 20%

time period = 5 year

to find out

net effect of annual depreciation on the free cash flow

solution

we know here cost of asset and  Salvage value so we get depreciation cost  

depreciation cost is = 11000 - 1000 = 10000  

and

annual depreciation = 2000  

so that Tax shield on depreciation will be

Tax shield on depreciation = 2000 × 30%

Tax shield on depreciation = 600

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<span>With respect to organizational change, this would also represent a change in the type of waste machines that are used in the Industry. Since the EPA is targeting a 30% reduction of waste generated by coal-fired powerplants, the manufacturing industries are now required to adapt the new method that is  establish to minimize carbon footprint.</span>
8 0
3 years ago
5) On July 12, Reliable Repair Service extended an offer of $150,000 for land that had been priced for sale at $185,000. On Sept
elixir [45]

Answer:

The price should be recorded as $167,500

Explanation:

As per the accounting principles, assets should be recorded at the price they were paid for. In case of a purchase, the accountant should record in the books the amount the company paid to acquire the asset. For sales, the amount received from the buyer is the figure to be recorded in the books.

For Reliable Repair Service, there were different prices quoted, but the buyer paid $167,500. It means the company sold the land for $165,000. This is the amount that should be recorded in the books.

5 0
2 years ago
A+b-c =170 B+c-A= 130 <br>solve​
balu736 [363]

The correct answer is A = 110, B= 40, C=20..

<u>Explanation</u>

If A+B-C= 170 and B+C-A=130 ,  

=C+A = 130

or, C= 130- A

Again, A+B-C =170

or, A+B =170+C

A+B = 170+130-A ( c=130-A)

A+B = 300-A

2A+B = 300

A+B= 300/2

A+B = 150

A+B-C= 170

A+B = 170+C

150 = 170 +C ( A+B = 150)

or, C = 20..............................(1.)

A+C =130

or,A+ 20= 130 ( A=110).....................(2)

A+B = 150

110+B= 150

B = 150-110

B= 40..........................................(3)

Therefore, A = 110, B= 40, C=20..

8 0
3 years ago
(Ignore income taxes in this problem.) The Sawyer Corporation has $145,000 to invest and is considering two different projects,
Ivan

Answer: -$‭20,529.6‬0

Explanation:

Net Present value of Y = Present Value of Inflows - Present value of Outflows

Present Value of Y inflows

$32,000 inflows for 5 years. This is therefore an annuity

Present value of annuity = Annuity * Present value interest factor, 9%, 5 years

= 32,000  * 3.8897

= $‭124,470.4‬0

Net Present Value = 124,470.4‬0 - 145,000

= -$‭20,529.6‬0

7 0
3 years ago
11. King Arthur is going into battle and he needs to decide how many more swords and helmets he should buy. The tables show the
Kazeer [188]
Can show the tables?
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2 years ago
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