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
Determine Opportunity Costs A company has material B in stock that originally cost Shs. 5000 for the 1000 Kshs in stores. The material is missing over from an old purchase ord

REPORT ON SATYAM

General Motors has to raise new capital in one of the following three ways. Using the income tax rate of 32%, find the after-tax cost of new capital in each case. (A) Sell commo

Job Costing This is a costing method that is applied when a job or cost unit is relatively of small size, is undertaken to fit the customer's specifications and is of compara



Q. Explain Break-even revenue? Sales revenue earned would give no profit and no loss. It can be computed by multiplying break-even volume (above) by products selling price, or

Question: Timothy Ltd uses a flexible budget for overhead costs. The company expects to produce 40,000 units of the product it manufactures. Each unit requires 0.40 direct labo

What are the key reasons for product cost differences among traditional costing system and ABC systems? Explain four decisions for which ABC information is useful?

Weighted Average Method This way is a perpetual weighted average system whereas the issue price is recalculated after one of receipt of stocks taking into accounts both money