Firm X is considering the replacement of an old machine with one that has a purchase price of $85,000. The current market value of the old machine is $23,000 but the book value is $37,000. The firm's combined tax rate is 34%. What is the net cash outflow for the new machine after considering the sale of the old machine? Disregard the effect of depreciation of the new machine if acquired. Multiple Choice O $57,240 $53,840 $63.110 $69,590
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- Firm X is considering the replacement of an old machine with one that has a purchase price of $100,000. The current market value of the old machine is $23,000 but the book value is $38,000. The firm's combined tax rate is 30%. What is the net cash outflow for the new machine after considering the sale of the old machine? Disregard the effect of depreciation of the new machine if acquired. Multiple Choice $72,500 $78, 370 $84, 850 $69, 100Firm X is considering the replacement of an old machine with one that has a purchase price of $70,000. The current market value of the old machine is $22,000 but the book value is $ 37,000. The firm's combined tax rate is 27%. What is the net cash outflow for the new machine after considering the sale of the old machine? Disregard the effect of depreciation of the new machine if acquired.Old equipment with a book value of P15,000 will be replaced by new equipment with a purchase price of P50,000, exclusive of freight charges of P2,000. The market value of the old equipment is P11,000. Repair costs of P2,000 can be avoided if the new equipment is acquired. Assume a tax rate of 35%. What is the initial (net)investment of the project? Select one: a. P33,800 b. 52,000 c. P38,300 d. P39,700
- Gumamela Company is considering replacing a machine with one that will save P50,000 per year in cash operating costs and has P20,000 more depreciation expense per year than the existing machine. The tax rate is 40%. Buying the new machine will increase annual net cash flows of the company by Select one: a. P20,000 b. P30,000 c. P12,000 d. P38,000 Old equipment with a book value of P15,000 will be replaced by new equipment with a purchase price of P50,000, exclusive of freight charges of P2,000. The market value of the old equipment is P11,000. Repair costs of P2,000 can be avoided if the new equipment is acquired. Assume a tax rate of 35%. What is the initial (net)investment of the project? Select one: a. P33,800 b. 52,000 c. P38,300 d. P39,7004. Acme is considering the sale of a machine with a book value of P160,000 and 3 years remaining in its useful life. Straight-line depreciation of P50,000 annually is available. The machine has a current market value of P200,000. What is the cash flow from selling the machine if the tax rate is 30%? Group of answer choices P192,000 P184,000 P200,000 P188,000 P190,000Sampaguita Company is considering the sale of a machine with a book value of P80,000 and 3 years remaining it its useful life. Straight-line depreciation of P25,000 annually is available. The machine has a current market value of P100,000. What is the cash flow from selling the machine if the tax rate is 40%? Select one: a. P88,000 b. P92,000 c. P80,000 d. P100,000
- Palmer Corp. is considering the purchase of a new piece of equipment. The cost savings from the equipment would result in an annual increase in net income after tax of $164,900. The equipment will have an initial cost of $485,000 and have a 7 year life. If the salvage value of the equipment is estimated to be $9,000, what is the accounting rate of return? Multiple Choice 34.00% 23.28% 156.37% 51.11%Moda Produce is considering the purchase of a new machine to replace the existing asset. The current market value of the old fixed asset is $14,000, and $5,000 is its book value. The new equipment's cost as a fixed asset is $30,000. If the firm's marginal tax rate is 40%, what is the initial investment outlay for the acquisition of this new asset?A project to replace an old machine with a new one is under consideration. The new machine costs $12.000 and requires an additional working capital investment of $750. The old machine is expected to have a $750 salvage value. Calculate the Initial Outlay of this replacement project assuming the book value of the old asset is $1500. The firm's marginal tax rate is 50%. O None of the listed choices is correct O $11.287.50 O $12.037.50 O $12.112.50 O $11,625.00
- XMohan & Co. is considering the purchase of machine. Two machines X and Y each Costing Rs.50, 000 are available. Earnings after taxes before depreciation are expected to be as under: Year 1 2 3 4 5 Machine 'X' 15000 20000 25000 15000 10000 (Rs.) Machine 'Y' (Rs.) 5000 15000 20000 30000 20000 Estimate the two alternatives according to: (a) Payback method, and (b) NPV method a discount rate of 10% is to be used.A company has purchased a machine (CCA rate 24%) at $300,000 and has a tax rate of 33.00%. By how much will the NPV change if the company is able to obtain a $13,000 salvage value for its machine at the end of the project's life in Year 4? Assume a discount rate of 11.20% and that all else remains the same. Question 10Answer a. $8,502 b. $10,415 c. -$1,913 d. $6,589 e. $10,075A 21%-tax bracket firm (Lessee) is considering the use, for two years, of a truck that costs $150,000 today. This firm can buy the asset or lease it from another 21%-tax bracket firm (Lessor) in exchange for $50,000 per year, with the first payment due at the time of signing. What is the Lessee's Time 0 incremental cash flow of buying the asset instead of leasing it?