1-5 Calculate financial net income AFIT and net cash flow AFIT for year 3 only. Your Time 0 investment for a pumping unit is $50,000. An- nual gross revenues are $40,000. Direct costs are $5,000 per year. Depreciation for financial net in- come is calculated assuming a 5 year life, no salvage value, and the straight line method. Cash income taxes are 40% of gross revenue. Assume

1-5 Calculate financial net income AFIT and net cash flow AFIT for year 3 only. Your Time 0 investment for a pumping unit is $50,000. An- nual gross revenues are $40,000. Direct costs are $5,000 per year. Depreciation for financial net in- come is calculated assuming a 5 year life, no salvage value, and the straight line method. Cash income taxes are 40% of gross revenue. Assume

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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F. The College of Engineering is planning to put up its own laboratory building Two proposals being considered are: AThe construction of the building now to cost P4 000 000 B The construction of a smaller building now to cost P3 000 000 and atthe end of d years, an extension to be added to cost P2 000 00O CO3 12. By how much is proposal B more economical than proposal A if interest rate is 20% and depreciation to be neglected? a. P 150,000 b P 169 000 c.P130,000 d. none of the above CO3 13. What is the effective rate of 12% compounded monthly2 b. 10 45% 14. What is the effective rate of 12.5% compounded annually? b. 11.45% a 11.68% c 21% d. none of the above | Co1 a 12.68% 15. 1f you are investing your money which is belter for the two conditions stated above? a 12% compounded monthly c 31% d. none of the above. CO3 13% annually b. 12.5% compounded C. Compounded | d none of the above annually
Electronic Games is moving very quickly to introduce a new interrelated set of video games. The initial investment for equipment to produce the necessary electronic components is $9 million. The salvage value after 6 years is $700,000. Anticipated net contribution to income is $6 million the first year, decreasing by $1 million each year for 6 years, with all dollar amounts expressed in real dollars. Depreciation follows MACRS 5-year property, taxes are 40 percent, the real MARR is 18 percent, and inflation is 4 percent. g. Determine the real IRR of the after-tax cash flows. h. Determine the real ERR of the after-tax cash flows.
1) Margaret has invested in a project that will cost $17000 upfront and will provide annual revenue of $5700 each year for 10 years. If the interest rate is 15% calculate the present worth of this project. Round your answer to two decimal places. 2) An asset cost $26000 with a salvage value of 2500 after 10 years. Assuming straight line depreciation, calculate the book value in year 4. Round your answer to the nearest dollar. please do both questions
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taxable income on ructions, and publications, visit www.irs.gov or call RM (800-829-3676). u e-tile your tax return? Electronicaly fled returns are less kely to have ma errors resulting in notices such as this one. t's free to file your taxes electronicaly Go to www.irs.govlefile for information and instructions • You can contact us by mail at the address at the top of the first page of this notice de sure to include your Social Securiy Cumber and the tar year and form number you are writing about • Keep this notice for your records • Activity on your 2020 account may be detaying the relese of your neftund receive a notice explaining this delay • Estimated Tax Filers Note, i# you pn sta taes c Hill Graw P Type here to search 直。 000'006$ ) $750,000. eBook The total revenues of Harvey's firm in the first year were 81°F Sunny ^ 10/17/2021 3:57 PM
A 5- year MACRS has a cost basis for depreciation of $20,000. Salvage (market) value is $4,000. The depreciation charge for the third year and Book value of asset after third year of the depreciation is it closest to what value? a. $3840, $16160 b. $3840, $5760 c. $6400, $5600 d. $6400, $9600