What is the after-tax cash flow from the salvage value

Assignment Help Financial Management
Reference no: EM131524817

For your reference, the following are depreciation percentages for a 5-year MACRS property, for years 1 through 6 respectively: 20%, 32%, 19.2%, 11.52%, 11.52%, 5.76%. A firm purchased some fixed assets two years ago for $40,300. The assets are classified as 5-year property for MACRS. Now, the firm is considering selling these assets, so it can buy some newer fixed assets which utilize the latest in technology. The current market value of the old assets is $23,146. What is the after-tax cash flow from the salvage value if the tax rate is 32 percent?

Reference no: EM131524817

Questions Cloud

When you begin building a financial model : When you begin building a financial model, you must:
What is compounded annual rate implied : What is the compounded annual rate implied by this 20 percent rate charged for only two weeks?
What are examples of the required rate of return : What are examples of the required rate of return? Explain the difference between a joint venture and a strategic alliance.
What is the project net present value : What is the project's net present value if the required rate of return is 8.6 percent?
What is the after-tax cash flow from the salvage value : What is the after-tax cash flow from the salvage value if the tax rate is 32 percent?
Used as the initial cash flow for this building project : What amount should be used as the initial cash flow for this building project?
What was the return on assets : If sales were $4million, the debt ratio was 0.40, and total liabilities were $2million, what was the return on assets (ROA)?
Capital will revert back to normal at the end of the project : Working capital will revert back to normal at the end of the project. What is the NPV of this project if the discount rate is 10.5 percent?
Considering the sale of new sound board : Meld Music Company is considering the sale of a new sound board used in recording studios.

Reviews

Write a Review

Financial Management Questions & Answers

  Standard estimator of the volatility parameter

Consider the following collection of n = 9 closing prices for stock ABC: Compute the standard estimator of the volatility parameter σ using these closing prices.

  Staffing-training-recruitment-retention

Select a health care organization (local or national, large or small, public or private) and perform a needs assessment/gap analysis.

  Issued dividend-what is the companys cost of equity

The Muse Co. just issued a dividend of $2.95 per share on its common stock. The company is expected to maintain a constant 6.10 percent growth rate in its dividends indefinitely. If the stock sells for $59 a share, what is the company’s cost of equit..

  Purchasing bonds with warrants instead of straight bonds

Pierre Imports recently issued two types of bonds. The first issue consisted of 10-year straight debt with a 9 percent annual coupon. Calculate the implied value of the warrants attached to each bond. Discuss 3 advantages to the investor of purchasin..

  What is percentage change in the price of these bonds

Bond J has a coupon rate of 5.1 percent. Bond S has a coupon rate of 15.1 percent. Both bonds have nine years to maturity, make semi annual payments, and have a YTM of 11.2 percent. If interest rates suddenly rise by 3 percent, what is the percentage..

  Student loans at an annual interest rate

While Mary Corens was a student at the University of Tennessee, she borrowed $12,000 in student loans at an annual interest rate of 8.80%. If Mary repays $1,500 per year, how long (rounded up to the nearest year) will it take her to repay the loan?

  Equipment to produce specialized aluminum products

ALUM, Inc. uses high-tech equipment to produce specialized aluminum products for its customers. Each one of these machines costs $1,520,000 to purchase plus an additional $48,000 a year to operate. The machines have a five-year life after which they ..

  List the four inputs needed to value a bond

List the four inputs needed to value a bond ? When valuing a zero-coupon bond, why are semiannual periods used in discounting?

  Sandwich is neither insolvent nor bankrupt

The cancellation is not a gift, and Mr. Sandwich is neither insolvent nor bankrupt.

  Provide a detailed description of the firms

Provide a detailed description of the firms-  Describe their primary activities and markets - Provide a three year ratio analysis with the financial statement - balance sheets, income statement, cash flow.

  What is steves cost of retained earnings

Steve's Specialties Inc. paid its dividend yesterday, which was $1.25. The dividend has been growing at a rate of 0.045 and is expected to continue indefinitely at that rate. Steve's common stock is currently trading at 21.00 per share. The firms bet..

  Government bond with a yield

Two years ago, Mathew purchased a 10 year government bond with a yield of 4.75%. Today, the 23) interest rate on government bonds with 8 years to maturity is 3.5%. If Mathew sells his bond today, he most likely will

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd