Solution-What is the project cca tax shield in year 1

What is the project cca tax shield in year 1

Assignment Help Finance Basics

Reference no: EM133055988

You are considering a project that requires $80,000 investment in fixed assets and $30,000 upfront investment in net working capital. Assume the salvage value of fixed assets is 0. The project is expected to produce sales of $213,000 with associated costs of $97,000. The project has a 3-year life. Fixed assets belong to a 10% CCA class. The tax rate is 35%, and the discount rate is 12%.

-What is the project's CCA tax shield in year 1?

-What is the project's after-tax operating cash flow in year 1, ignoring the CCA tax shield? (5 points)need asap with full steps

Reference no: EM133055988

Questions Cloud

What is the amount to use as the annual sales figure : Question - Winnebagel Corp. currently sells 28,700 motor homes per year at $76,500 each. What is the amount to use as the annual sales figure

Calculate the quick ratio : Calculate the quick ratio based on the following information: cash = $14,870; accounts receivable = $22,108; prepaid $3,010; supplies = $927

Construct a bond portfolio : An investor wants to earn a minimum return of 3% over the next 5 years. He doesn't want to take any price risk and reinvestment risk. As a portfolio manager, h

Prepare journal entries in the internal service fund : Assume that the city accepts the comptroller's suggestion. Prepare journal entries in the internal service fund to record transfer-in of the $300,000

What is the project cca tax shield in year 1 : You are considering a project that requires $80,000 investment in fixed assets and $30,000 upfront investment in net working capital. Assume the salvage value o

Initial investment in net working capital : After Charlotte became CEO of XYZ, she had so many ideas that have worked to make the company very large and profitable. Due to uncertainty, her CFO assigns a R

What is the npv of this project : Kolby's Korndogs is looking at a new sausage system with an installed cost of $700,000. What is the NPV of this project

What is the amount of the monthly payments : Problem: A commercial bank will loan you $26,937 for 6 years to buy a car. The loan must be repaid in 24 equal monthly payments. The annual interest rate on the

Calculated amounts should be supported : Using the above information for Marlin Corporation, complete the pension worksheet for 2020 and 2021. Calculated amounts should be supported

User Account

All Pages

What is the project cca tax shield in year 1

Reference no: EM133055988

Reference no: EM133055988

Questions Cloud

Reviews

Write a Review

Finance Basics Questions & Answers

Financial reporting and analysis

A report on financial accounting

Describe the types of financial ratios

Differences between sole proprietorship and corporation

Prepare a cash budget statement

What are the implied interest rates

State pricing theory and no-arbitrage pricing theory

Small business administration

Effect of financial leverage

Evaluate the basis for the payment to the lender

Importance of opps, ipps, mpfs and dmepos

Time value of money

Assured A++ Grade

Academics

Major Subjects

Majors

Get In Touch

TERMS & POLICIES

HELP & SUPPORT