Depreciable cost, Cost Accounting

A organization is evaluating a proposed 4-year project.  The depreciable cost will have the following: $300,000 for the equipment, $20,000 for shipping, and $30,000 for installation. The depreciation life is under the MACRS 3-year class, with a salvage value of $45,000. The inventories will increase by $18,000 and accounts payable will rise by $3,000. In addition, the new sales are estimated to be 150,000 units per year at $2.25 per unit. There is a variable operating cost that is 60% of sales and the company's marginal tax rate is 35%.  Do parts (a) through (c) below.

a) Verify the net operating cash flow for the initial year (Year 0).

b) Verify the net operating cash flow for Years 1, 2, and 3.

c) Verify the net terminal year cash flow.

Posted Date: 3/26/2013 9:03:56 AM | Location : United States







Related Discussions:- Depreciable cost, Assignment Help, Ask Question on Depreciable cost, Get Answer, Expert's Help, Depreciable cost Discussions

Write discussion on Depreciable cost
Your posts are moderated
Related Questions
Sony manufactures battery for Iphone 6+. The average costs to manufacture batteries are $4 for 10,000 ad $2.67 for 30,000. Assuming the total cost function is linear, what will be

Johnson Farms owns valuable farm land that permits it to make wheat at a lower cost than its competitors. The company reports large profits every year on its accounting statements.

While on a business trip to Texas, David attended a mortgage foreclosure auction. At the auction (held on February 4, 1999), he acquired an abandoned sugarcane farm near Pearland.

XYZ Company is a family-owned bicycle manufacturing company located in Stow, Ohio. Until recently,it had maintained slow but steady growth in producing and marketing its only prod

The number of workdays varies from month to month due to the number of weekdays, holidays, days of vacation, and sick leave taken in the month. The number of units produced in a

QUESTION 1: PART A Swatathon Inc. has two production departments (A and B) and two service departments (maintenance and stores). Details of next year's budgeted overheads

Extracts from P Co''s records for last month are as follows: BUDGET ACTUAL PRODUCTION 7,000 UNITS 7,200 UNITS Direct Material $42,000 $42,912 Calculate

Cash is the other form of fund although in a narrow sense, this refers to a supply which can be drawn upon as per to the need. Here the term cash involves both cash and cash equiva


Question 1 Discuss the various elements of cost Question 2 Explain the various stages involved in the distribution of factory overheads Question 3 Define activity-based