Annual cash flow and the project terminal cash flow

Assignment Help Financial Management

Reference no: EM131519518

Jefferson Corporation is purchasing equipment with a 10-year life which will increase revenue by $38,000 per year and increase expenses by $21,000 per year. The cost of the project is $24,000, and the equipment has a salvage value of $9,000 at the end of the tenth year. The project will require a $6,000 investment in net working capital immediately. The equipment will be depreciated for 10 years using simplified straight line. Jefferson's marginal tax rate is 35%. Calculate the total year 10 net cash flow, including both the last annual cash flow and the project's terminal cash flow. a) $23,740 d) $17,740 b) $21,340 e) $11,890 c) $20,890

Reference no: EM131519518

Questions Cloud

Current cash flows more valuable than future cash flows : Why are current cash flows more valuable than future cash flows?

How should yahoo deal with competition in the same industry : How should Yahoo! deal with competition in the same industry? What strategy should Yahoo! used to take advantage of this industry?

What are the characteristics of the teachers students : What are the characteristics of the teacher's students with ID that result in eligibility for special education?

New gss software : You have been hired to develop group support software for your university. Describe the features you would include in your new GSS software.

Annual cash flow and the project terminal cash flow : Calculate the total year 10 net cash flow, including both the last annual cash flow and the project's terminal cash flow.

Discuss the role of your values and your self-awareness : Discuss the role of your values and your self-awareness in your work with clients or students. The old cliche' -- "Physician, heal thyself" could be converted.

Elements between the mac os x and linux : Discuss similar elements between the MAC OS X and Linux. Based on your research, why do think the two operating systems share these similarities.

Indicate the type of account : For each account, indicate (1) the type of account and (2) whether the normal account balance is a debit or credit. For the type of account, choose from asset.

Advantages of starting a company inside a bigger company : Read and think about the case so you can talk about the differences between starting a business on its own versus starting a business

User Account

All Pages