Think about an item that you are interested in purchasing. Perhaps it is a new computer, an MP3 player, a new book, or a new bik
1 answer:
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Answer:
$2,503 = Depreciation Expense
Explanation:
Net profit = $6,230 that is amount added to retained earnings.
Net profit = Sales - Cost - Depreciation - Interest - Taxes - Dividends
Sales = $104,650
Costs = $87,300
Interest = $1,620
Earnings before depreciation and taxes = $104,650 - $87,300 - $1,620 = $15,730
Earnings after interest depreciation and taxes = $6,230 + $2,500 = Net profit + Dividend = $8,730
Therefore
(15,730 - Depreciation) - (15,730 - Depreciation) 34% = $8,730
$15,730 - Depreciation - ($5,348 - 0.34 Dep) = $8,730
$10,382 - 0.66 Depreciation = $8,730
$1,652 = 0.66 Depreciation
$2,503 = Depreciation Expense
Answer:
Yes it should as the net present value at the firm WACC is positive $ 4,156.54
Explanation:
we are given with the after-tax cost for the machine and after-tax cost of the labor cost savings the new machine will provide
So we should check if the present value of the savings is greater or equal than the machine cost:
C $ 8,000
time 10 years
rate=WACC= 0.1
PV $49,156.5368
Net present value:
inflow - cost
49,156.54 - 45,000 = 4,156.54