(v) Depreciation charged in costing books is 12,500 and in financial books is 11,200. What will be the financial profit when costing profit is ? 5,000? A. 5,000 B. 3,700 C. १6,300 D. None of the above (vi) A bus carries 25 passengers daily for 25 days and its mileage per month is 2,000 kms. Its passenger kms. are A. 60,000 B. 25,000 C. 40,000 D. 50,000
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- An auto repair company needs a new machine that will check for defective sensors. The machine has an Initial investment of $224,000. Incremental revenues, including cost savings, are $120,000, and Incremental expenses, including depreciation, are $50,000. There is no salvage value. What is the accounting rate of return (ARR)?Q1) A catering company buys a delivery truck for $34000 for its everyday business. The lifetime of the truck is estimated Five years and the production life in Kilometers is 200 000 KM. The residual value at the end of its lifetime is $4000. The truck has the following production in five years. Year 1 30 000 KM Year 2 40 000 KM Year 3 50 000 KM Year 4 70 000 KM Year 5 10 000 KM Requirements: Compute the Depreciation Expense under the following methods. Double Declining Balance Method. Sum-of-year-digit MethodSuppose a new car is purchased for $61,000 and depreciates by 28% over the first year of ownership. If the car is driven 14,400 miles in that year, what is the cost (in dollars) per mile for depreciation. Round your answer to the nearest cent.
- Suppose a new car is purchased for $41,357 and depreciates by 21% over the first year of ownership. Find the depreciation of the car over the first year. $… If the car is driven 12,870 miles in that year, what is the cost, in dollars per 100 miles driven, for depreciation? (Round your answer to the nearest cent.) …? Dollars per 100 milesWhat is the depreciation using straight line deprectiation over 12 years, what is the revenue earned each year, and what are total taxes with a maginal rate of 40%? Price per bus $225,500 Units sold per year 7,750 Labor cost per bus $52,000 Components & Parts $94,000 Selling General & Administrative $250,000,000 per year NOTE: Average warranty cost per year per bus for the first five years is $1,100. The present value of this cost will be used as a cost figure for each bus. Afterwards, the bus operator will become responsible the repairs on the buses. PV of bus warranty = 4,776 NOTE: There is a marginal tax rate of 40% The buses can be produced for twelve years. Afterwards, the designs become obsolete. Engine Detroit engines Price per engine, including installation $20,000 Average annual warranty cost per year Present Value = $6,512 $1,000 The engine will be…A business is planning to purchase new equipment at a cost of £60,000. The equipment is expected to last 4 years and to have no scrap value (residual value). Depreciation is calculated on a straight-line basis. The investment is expected to generate the following profits/(losses): Year 1 2 3 4 Profit/(loss) (10,000) 20,000 40,000 20,000 Required: Convert these profits/(losses) to cash flows.
- A lessor made an investment of ₱550,000 in equipment with an expected life of 5 years. He expects and incremental revenue of ₱460,000 while costs to be incurred are: Costs of sales₱120,000; Marketing, admin, and maintenance ₱150,000. Tax rate is 25%. Annual depreciation is ₱110,000. Cost of capital is 11%. The NPV would be? ₱ 87,203 ₱ 152,221 (₱ 23,334) ₱ 78,302 ₱ 63,712 ₱ 28,486What is the Operating Profit? Example: Sales are $2,500,000. Cost of goods sold is $1,710,000 and Administrative expenses are 10%. Depreciation is 6% and the total assest is $4,680,000.TransITRI is a transportation company with a recent need of a new construction equipment at a first cost of $78,000 (Equation (1)), zero salvage value, and a cash flow before taxes (CFBT) per year t that follows Equation (2). CFBT = $30,000 – 3,000t (for t = 1, 2, … T) (1) CFBT = - $78,000 (for t =0) (2) Calculate the PW if the economic life of similar machinery is 7 years, while the MARR is 16%
- Consider equipment for the expansion of a production line that will cost $600,000 up front (i.e., today, t = 0). The production line will be depreciated using a 3-year straight-line schedule. At the end of Year 3, the used equipment will have no value. The new line will generate earnings according to the schedule below. What is the Average Accounting Return (AAR) of the new production facility? Answer with a number rounded to three decimal places, e.g., 4.0877% should be entered as 4.088. Year 01 Earnings = $24,500 Year 02 Earnings = $26,000 Year 03 Earnings = $27,250A company buys a machine for $180,000 that has an expected life of nine years and no salvage value. The company expects an annual net income (after taxes of 30%) of $8,550. What is the accounting rate of return? a. 4.75% c. 2.85% e. 6.65% b. 42.75% d. 9.50%Besh Company had an investment which cost $260,000 and had a salvage value at the end of its useful life of zero. If Besh's expected annual net income is $15,000, the annual accounting rate of return is: (calculate average investment value first over its economic life) a) 9.8%. b) 5.8%. c) 11.5%. d) 15%.
