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
We've all experienced (or heard about) the challenges that the airlines have been facing. Read the Zacks Investment Research article, "Airline Industry Stock Outlook - August 2012"

(a) Calculate Mexico's producer surplus and consumer surplus in autarky. (b) Calculate the number of Mexican imports with as well as without the Tarriff. (c) Calculate Mexico

Last in first out or LIFO LIFO is based upon the assumption such the stock purchased last is issued first. Stock valuation should here be based upon the prices ruling on acqui

If fixed costs are $743,122 and variable costs are 69% of sales, what is the break-even point in sales dollars? Select the correct answer. A. $512,754 B. $2,397,168 C. $1,255,876 D

Limitations of CVP Analysis The make use of the basic CVP model is just only relevant to planning and decision-making in an activity range whether the basic cost and revenue b

Estimate Fixed Overhead Variances Referring to data, we can estimate the fixed overhead variances as given below: Budget for December 2003;

Weston Corporation manufactures a product that is available in both a deluxe and a regular model. The company has made the regular model for years; the deluxe model was introduced

F ixed Overhead Variance (FOV) Fixed overhead variance has been described by ICMA, London, as 'the variation between the standard cost of fixed overhead absorbed in the pro

A transport company is preparing its cost budgets for the coming year. It has been set both social objectives & cost targets by the government which it must achieve in order to rec

(i) Describe the difference between the balance sheet and the income statement in financial statements of companies. (ii) Give two examples of intangible assets and two exampl