What is the depreciation tax shield for this project in year

Assignment Help Financial Management

Reference no: EM131359132

Your firm needs a machine which costs $230,000, and requires $38,000 in maintenance for each year of its 5 year life. After 3 years, this machine will be replaced. The machine falls into the MACRS 5-year class life category. Assume a tax rate of 30% and a discount rate of 13%. What is the depreciation tax shield for this project in year 5?

Reference no: EM131359132

Questions Cloud

About the under-valued or over-valued : Under/Over Valued Stock A manager believes his firm will earn a 16.4 percent return next year. His firm has a beta of 1.54, the expected return on the market is 14.4 percent, and the risk-free rate is 4.4 percent. Compute the return the firm should e..

Hazmat emergencies-decontamination and victim : For this assignment, you are required to read the article entitled "HazMat Emergencies: Decontamination and Victim Chain of Survival," by Gunderson, Helikson, and Heffner (2014), and write a review. The article may be found in the Academic Search C..

Compensation program management : Safety professionals that manage or are involved in workers' compensation program management must have a thorough understanding of workers' compensation rules, regulations, and procedures associated with the state's workers' compensation system.

What will be the firm cash cycle : Suppose that Freddie's Fries has annual sales of $680,000; cost of goods sold of $555,000; average inventories of $27,000; average accounts receivable of $43,000, and an average accounts payable balance of $38,000. Assuming that all of Freddie's sale..

What is the depreciation tax shield for this project in year : Your firm needs a machine which costs $230,000, and requires $38,000 in maintenance for each year of its 5 year life. After 3 years, this machine will be replaced. The machine falls into the MACRS 5-year class life category. Assume a tax rate of 30% ..

Why sabermetric-based player evaluation : Write a critique of the article including the following points: Examine why sabermetric-based player evaluation is such a shock to other executives in baseball.

Calculating costs of issuing debt home improvement : Calculating Costs of Issuing Debt Home Improvement, Inc. needs to raise $3.00 million to finance plant expansion. In discussions with its investment bank, Home Improvement learns that the bankers recommend a debt issue with a gross proceeds of $1,000..

The stock consistently goes ex-dividend : JEN Corp. is expected to pay a dividend of $3.00 per year indefinitely. If the appropriate rate of return on this stock is 11 percent per year, and the stock consistently goes ex-dividend 30 days before dividend payment date, what will be the expecte..

Sophisticated and easily accessible technologies : The information age in which we live brings with it enhanced capabilities for individuals to communicate securely without expending great amounts of money, using fairly sophisticated and easily accessible technologies.

User Account

All Pages