Q: An industrial plant bought a generator set for P90,000. Other expenses including installation…
A: cost of Generator = 90,000 Installation Cost = 10,000 Therefore Book Value at starting = 90,000 +…
Q: Estimate the after-tax ROR for a project that has a before-tax ROR of 24%. Assume the company is in…
A: The rate of return after tax (RORAT) can be calculated by using the formula given below:
Q: For the MACRS method of depreciation, identify (a) the six standardized recovery periods for…
A: “Hey, since there are multiple subpart questions posted, we will answer the first three subpart…
Q: asset that is book-depreciated over a 5-year period by the straight line method has C3 = P 2,800,000…
A: The formula for straight line SL depreciation is given below: d = (P-S)/n Were, P = initial cost, n…
Q: An asset with a first cost of $300,000 is depreciated by the MACRS method using a 5-year recovery…
A: The economic value added (EVA) is a measure along with market value added to evaluate management’s…
Q: An automated assembly robot that cost $400,000 has a depreciable life of 5 years with a $100,000…
A: The cost of an automated assembly robot= $400,000 Depreciable life of the robot =5 years Salvage…
Q: In conducting an EVA analysis for year 2 for new equipment on its primary product line, Analogy,…
A: The first cost is denoted by ‘FC’. The recovery rate in year 1 (RR1) is 0.3333 and the recovery rate…
Q: New York Limousine Service owns 10 limos and uses the units-of-productionthe method in computing…
A: It is given that the cost of the Limo was $32,000 at the time of purchase and it was driven 24,000…
Q: projected to be 65,000 units per year. Price per hit is $63, variable cost per unit is $42, and…
A: The term depreciation refers to an accounting method used to allocate the cost of a tangible or…
Q: The first cost of a machine is P1,800,000 with a salvage value of P300,000 at the end of its life of…
A: Depreciation refers to the fall in values of the assets with the passage of time. The concept sets…
Q: Depreciation recapture occurs when a depreciable asset is sold for: (a) More than the current book…
A: Depreciation recapture is the gain obtained by the sale of depreciable capital property that must be…
Q: An engineering firm purchased a second hand truck for P 530,000 and paid P 15,000 for freight and…
A: Given:- Purchase price=P530,000 Freight charge(Included in purchase price)=P15,000 Life=10 years…
Q: A certain commodity is amounting P1million. Freight and installation charges amounted to 3% of the…
A: Given Cost of commodity = 1,000,000. Freight and installation charges = 3% of the purchased price.…
Q: A currently-owned asset has B = $150,000, S = $95,000, and a 10-year depreciable life. The book…
A: Given information: Depreciation value for 4 years can be written as follows:
Q: An industrial equipment purchased price is P800,000 with estimated to have a life of 15 years. If…
A: Given initial cost = 800,000 P asset life - 15 years Depreciation = 18 % fixed rate therefore…
Q: An industrial plant bought a generator set for P120, 000. Other expenses including installation…
A: The total cost of the generator = P120000 + P10000 = P130 000 Salvage value = 8000 Life = 15 years…
Q: Helical Products makes machined springs with elastic redundant elements so that a broken spring will…
A: Tax amount can be calculated as follows: Tax amount=Gross income-Expense+Depreciation×tax…
Q: The annual depreciation of P25,000 has been reserve for a machine for a machine using straight line…
A:
Q: Under the General Depreciation System (GDS) of asset classification, any asset that is not in a…
A: Depreciation is used to show the fall in the value of assets over time. There are many ways to…
Q: A piece of equipment purchased at a cost $25 000 generated new income of $80,000 per year, witha…
A: Depreciation means a continuous fall in the value of an asset due to its use, wear and tear.
Q: A plant manager for a fiber optics cable manufacturing company knows that the remaining capital…
A: The first cost (FC) is $80,000. Depreciation lifer (n) is 5. Salvage value (SV) is 25 percent to the…
Q: Erectors Co. owns earth moving equipment that cost P90,000. After 8 years it will have estimated…
A: The double declining balance method of accelerated depreciation is a type of accelerated…
Q: A telephone company purchased a microwave radio equipment for P6,000,000. Freight and installation…
A: Here we calculate the depreciation on the equipment with 2 method by using the given information so…
Q: An equipment costs ¥ 10,000 with a salvage value of ¥ 500 at the end of 10 years. Calculate the…
A: Given: The equipment cost is = ¥ 10,000 Salvage value = ¥ 500 To Find: The depreciation charge and…
Q: A wood products company has decided to purchase new logging equipment for $100,000 with a trade-in…
A: The MACRS, or, Modified Accelerated Cost Recovery System is defined as the system of depreciation…
Q: An automated assembly robot that cost $362,000 has a depreciable life of 5 years with a $90,000…
A: The cost of an automated assembly robot= $362000 Depreciable life of the robot =5 years Salvage…
Q: A printing equipment costs P 74,506 has a life expectancy of 9 years and has a salvage value of P…
A: Depreciation is the amount of value reduces of the equipment per year and it can be used with many…
Q: XYZ Manufacturing is considering the purchase of a new punch press. This press will cost $63,112.…
A: $38,637.16640
Q: company purchased factory equipment on January 1, 2021 for $84,000. It is estimated that the…
A: Given Equipment cost in 1 Jan 2021 = 84000 $ Salvage value = 8000 $ Time = 10 years Adjusted value…
Q: A concrete batching plant bought a new generator set for P100,000, including installation and other…
A: *SOLUTION :-
Q: Software and hardware for optimizing cell design of robotic picking lines have an installed cost of…
A: Initial cost = $ 78000 N = 5 year Value after 5 year, Salvage value = $0 DDB method Formula for…
Q: A touch-sensitive assembly robot that costs $300,000 had a depreciable life of 5 years with an…
A: The cost of the touch-sensitive assembly robot is given to be $300,000 in the economy. The…
Q: A manufacturing company makes it a policy that for every new equipment purchased, the annual…
A: The largest change of depreciation using the SYD method: d1=(C0-Cn)nΣ years0.25C0=C0nΣ yearsΣ years…
Q: A gold mine with an estimated deposit of 300,000 ounces of gold has a basis of $30 million (cost…
A: Given: The estimated deposit for a gold mine is = 300,000 ounces The gold mine is purchased for =$30…
Q: An industrial plant bought a generator set for P90,000. Other expenses including installation…
A: The reduction caused in the value of an asset caused by its wear and tear, usage or time is called…
Q: quipment associated with manufacturing small railcars had a first cost of $170,000 with an expected…
A: Depreciation as per straight line method =[cost-salvage]/useful life = […
Q: An asset that is book-depreciated over a 5-year period by the straight line method has C3 = P…
A:
Q: ABC Corporation makes it a policy that for any new equipment purchased, the annual depreciation cost…
A: Depreciation using SYD method: d1 = (Co- Cn) n∑years 0.2 C0 = C0(n∑years)∑years = 5n
Q: A coil winding and unwinding machine that costs $32,000 has a life of 9 years with a $4,000 salvage…
A:
Q: original cost of modem equipment is P 300,000 and it is depreciated by a 10% sinking fund method.…
A: In economics matters, devaluation or depreciation is the progressive diminishing in the monetary…
Q: A granary has two options for a conveyor used in the manufacture of grain for transporting, filling,…
A: Annual worth is calculated by present value of annuity formula. Present value of cash flows from the…
Q: Youngblood Shipbuilding Yard just purchased $1 million in capital equipment for ship repairing…
A: a. Cost (C) is $1,000,000. Salvage value (S) is $150,000. The recovery rate (RR) for year 3 is…
Q: A contractor imported a bulldozer paying P350k to the manufacturer, freight & insurance charges…
A:
Q: Weber Drilling Company is considering investing $20M in oil and gas drilling equipment. It is…
A: The present value of cash flows at the needed rate of return on your project relative to your…
Q: An equipment costs P10,000 with a salvage value of P500 at the end of 10 years. Calculate the annual…
A: Annual depreciation is defined as the standard yearly rate at which depreciation is charged to a…
Q: Freeman Engineering paid $40,000 for specialized equipment for use with their new global positioning…
A: A depreciation scheme used for tax reasons in the United States is the modified accelerated cost…
Q: A machine that had a first cost of $120,000 was depreciated by the MACRS method over a 3-year…
A: Given, A machine that had a first cost of $120,000 was depreciated by using Modified Accelerated…
Q: Equipment associated with manufacturing small railcars had a first cost of $180,000 with an expected…
A: Differences in tax between the straight-line depreciation method and MARS method can be calculated…
Q: A gold mine with an estimated deposit of 300,000 ounces of gold has a basis of $30 million (cost…
A: Given the value of the estimated deposit for a gold mine is 300000, the gold mine is purchased for…
Q: Cebu Pacific purchased a new aircraft engine diagnostics equipment for its maintenance support…
A: Depreciation refers to two aspects of the one concept: first, is the actual decrease in fair value…
Estimate the CFAT for a company that has taxable
income of $120,000,
and an effective tax rate of 35%.
Trending now
This is a popular solution!
Step by step
Solved in 2 steps
- Estimate the after-tax ROR for a project that has a before-tax ROR of 24%. Assume the company is in the 35% tax bracket and it used MACRS depreciation for an asset that has a $27,000 salvage value.Which of the following is not true about depreciation? a. Depreciation is not a cash flow b. To be depreciable, an asset must have a life longer than 1 year c. A 5-year property will generate regular MACRS-GDS depreciation deductions in 6 fiscal years d. For MACRS-GDS an estimate of the salvage values is required.A machine that had a first cost of $120,000 was depreciated by the MACRS method over a 3-year period. The machine was sold for $60,000 at the end of year 2, because the company decided to import the component made by the machine. If the company’s gross income was $1.4 million with operating expenses of $500,000, what was the tax liability in year 2 for an effective tax rate of 35%?
- Freeman Engineering paid $40,000 for specialized equipment for use with their new global positioning system/geographic information system (GPS/GIS). The equipment was depreciated over a 3-year recovery period using Modified Accelerated Cost Recovery System (MACRS) depreciation. The company sold the equipment after 2 years for $8,000 when it purchased an upgraded system. Determine the amount of the depreciation recapture or capital loss involved in selling the asset. The amount of capital loss is determined to be $____An after-market auto parts company sells a machining robot that had been depreciated to zero for $16,000. If the company’s effective tax rate is 36%, the sale will: (a) Increase the company’s taxes by $16,000 (b) Increase the company’s taxes by $5760 (c) Reduce the company’s taxes by $16,000 (d ) Reduce the company’s taxes by $5760Helical Products makes machined springs with elastic redundant elements so that a broken spring will continue to function. The company has gross income of $450,000 with expenses of $230,000 and depreciation of $48,000. Approximate the company’s total taxes for an effective tax rate of 38%.
- Under the General Depreciation System (GDS) of asset classification, any asset that is not in a stated class is automatically assigned a recovery period of: (a) 5 years (b) 7 years (c) 10 years (d) 15 yearsDepreciation recapture occurs when a depreciable asset is sold for: (a) More than the current book value (b) More than the current market value (c) More than the estimated salvage value (d ) More than the first costMaterial-handling equipment used in the manufacture of grain products (MACRS-GDS 10-year property) is purchased and installed for $180,000. It is placed in service in the middle of the tax year. If it is removed just before the end of the tax year approximately 4.5 years from the date placed in service, determine the depreciation deduction during each of the tax years involved using MACRS-GDS allowances. ———————- Repeat the previous problem if the material-handling equipment is removed just after the tax year, again using MACRS-GDS allowances.
- A corporation in 2018 expects a gross income of $680,000, total operating expenses of $480,000, and capital investments of $29,000. In addition the corporation is able to declare $53,000 of depreciation charges for the year. The federal income tax rate is 21%. What is the expected taxable income and total federal income taxes owed for the year 2018?A touch-sensitive assembly robot that costs $300,000 had a depreciable life of 5 years with an expected $50,000 salvage value when purchased 3 years ago. Using MACRS depreciation, determine any DR, CG, or CL if the company sold the robot after 3 years for $80,000.Plant Company is contemplating the purchase of a new piece of equipment for $40,000. Plant is in the 20% income tax bracket. Predicted annual after-tax cash inflows from this investment are $14,000, $12,000, $5,000, $13,000 and $1,000 for years 1 through 5, respectively. The firm uses straight-line depreciation with no residual value at the end of five years. The hurdle rate for accepting new capital investment projects is 4%, after-tax. The estimated accounting rate of return (ARR) on this project (rounded to two decimal points), based on the initial investment is: Multiple Choice 2.50%. 3.16%. 6.50%. 9.83%. 11.83%.