What is the after-tax salvage value of the old machine

Assignment Help Financial Management
Reference no: EM131020131

Waterford Industries is considering the purchase of a new machine. It will replace an existing but obsolete machine that will be sold for $50,000. The existing machine is 8 years old, cost $200,000, had a 10-year useful life, and is being depreciated to zero using the straight-line method. Waterford's income tax rate is 35%. What is the after-tax salvage value of the old machine? (Please show me how to work the problem!)

Reference no: EM131020131

Questions Cloud

What is the incremental free cash flow for year one : Your company is considering the replacement of an old delivery van with a new one that is more efficient. The old van cost $40,000 when it was purchased 5 years ago. The old van is being depreciated using the simplified straight line method over a us..
Explain the concept of risk and bheta : Explain the concept of risk and bheta. Include bheta’s different cases. Give your OWN examples. 2. Discuss bheta’s determinants. Give your OWN examples.
Mention the sarbanes and oxley act : Elaborate on the concepts of governance, accountability, transparency in companies. Ascertain that you include the interaction of owners, management and Board of Directors. Furthermore, mention the Sarbanes /Oxley act.
What do you expect the price of the bond to be in two years : You own a bond with the following features: 8 years to maturity, face value of $1000, coupon rate of 2% (annual coupons) and yield to maturity of 2.3%. If you expect the yield to maturity to remain at 2.3%, what do you expect the price of the bond to..
What is the after-tax salvage value of the old machine : Waterford Industries is considering the purchase of a new machine. It will replace an existing but obsolete machine that will be sold for $50,000. What is the after-tax salvage value of the old machine?
Notion of civic responsibility is important in understanding : The notion of civic responsibility is important in understanding
The median voter is powerful because : The median voter is powerful because
An individuals tax price is defined : An individual’s tax price is defined as A. His or her proportion of the cost of a public program. B. His or her total cost of a public program. C. His or her proportion of the cost of a marginal dollar of a publicly provided good. D. His or her addit..
Private goods to get a given increment in public goods : The text states that the poor are less willing than the rich to give up a dollar of private goods to get a given increment in public goods.

Reviews

Write a Review

 

Financial Management Questions & Answers

  Find the value of a european put option

Toyohashi Co common stock has market price $85 per share and its sigma is 0.30. Find the value of a European put option, with an exercise price of $75 and expiring after 110 days, on the Toyohashi stock. The riskless rate is 3.5%

  Linear regression for projecting next years sales

If the sales data from 2009-2013 had been 1024, 1499, 1589, 1823, and 1950 using linear regression - what would the projected sales figure for 2014 be? What assumption is made when you use Linear Regression for projecting next year's sales? Is this a..

  How many days would the cash conversion cycle be changed

Cyree Inc. has annual sales of $80,000,000; its average inventory is $20,000,000; and its average accounts receivable is $16,000,000. The firm buys all raw materials on terms of next 35 days, and it pays on time. The firm is searching for ways to sho..

  How net present value and internal rate of return

"Explain how the Net Present Value (NPV) and Internal Rate of Return (IRR) analyses work and how they can be used to make financial investment decisions. Provide an example of the NPV analysis.

  Making plans for summer vacation

Jane Chang is making plans for a summer vacation. She will take $1,000 with her in the form of traveler’s checks. From the newspaper, she finds that if she purchases the checks by May 31, she will not have to pay a service charge.

  Calculate hastings required return

Hastings Entertainment has a beta of 0.65. If the market return is expected to be 11 percent and the risk-free rate is 4 percent, what is Hastings' required return? and use the capital asset pricing model to calculate Hastings required return.

  Operating cash flow if the company has no long-term debt

The Beach House has sales of $750,000 and a profit margin of 6 percent. The annual depreciation expense is $80,000. What is the amount of the operating cash flow if the company has no long-term debt?

  Cost of common equity and wacc

Patton Paints Corporation has a target capital structure of 40% debt and 60% common equity, with no preferred stock. Its before-tax cost of debt is 9% and its marginal tax rate is 40%. The current stock price is P0 = $31.50. The last dividend was D0 ..

  Element of budgeted financial requirements-budgeted expenses

Which of the following is an element of budgeted financial requirements that is not included in budgeted expenses?

  Amount to be invested today

Roy Gross is considering an investment that pays 6.10 percent, compounded annually. How much will he have to invest today so that the investment will be worth $28,000 in six years?

  Calculate the NPER for an investment

Calculate the NPER for an investment, given the following information: Calculate the FV on an ordinary annuity, given the following information:

  Companys inventory at the lower of cost or market

A company’s normal selling price for its product is $29 per unit. However, due to market competition, the selling price has fallen to $24 per unit. This company's current inventory consists of 290 units purchased at $25 per unit. Replacement cost has..

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd