Calculate maccauley companys after tax operating cash flow

Assignment Help Financial Management

Reference no: EM131338385

1. How is the opportunity cost concept used in the capital budgeting process?

2. The MacCauley Company has sales of $200 million and total expenses (excluding depreciation) of $130 million. Straight-line depreciation on the company's assets is $15 million, and the maximum accelerated depreciation allowed by law is $25 million. Assume that all taxable income is taxed at 40 percent. Assume also that net working capital remains constant.

a. Calculate the MacCauley Company's after-tax operating cash flow using both straight-line and accelerated depreciation.

b. Assuming that the company uses straight-line depreciation for book purposes and accelerated depreciation for tax purposes, show the income statement reported to the stockholders. What is the after-tax operating cash flow under these circumstances?

Reference no: EM131338385

Questions Cloud

Compare average monthly temperature for april and october : In this equation, t denotes the number of months with January represented by 1. Compare the average monthly temperature for April and October

Asset expansion and asset replacement projects : Distinguish between asset expansion and asset replacement projects. How does this distinction affect the capital expenditure analysis process?

Article on virtual health or telehealth : Find a scholarly article on Virtual Health or TeleHealth. Summarize the article and provide your thoughts on it. Please ensure that you cite your source in APA format.

How you compete in the current job market : Identify your options in the job market based on your educational level - How will increasing your level of education affect how you compete in the current job market and how will increasing your level of education affect your role in the future of n..

Calculate maccauley companys after tax operating cash flow : How is the opportunity cost concept used in the capital budgeting process?- Calculate the MacCauley Company's after-tax operating cash flow using both straight-line and accelerated depreciation.

Create a database and import text files into tables : Mr Sev N O'Nine, your manager, has set up the following tasks for you to complete for this phase of the project: Create a Database and import the four (4) Text files into four (4) Tables, Modify Table Design and Set Primary Keys

Pressing ethical issues surrounding genetic testing : What do you consider the most pressing ethical issues surrounding genetic testing? Provide at least two examples, and explain why you consider these most important.

How would differing level of project risk influence : In general, how would a capital budgeting constraint on the available amount of investment funds influence these decisions?

Explain why the cosine function is a periodic function : Sketch the graph of a periodic function that is neither the sine nor cosine function. State the period of the function.

User Account

All Pages