Ask Question, Ask an Expert

+1-415-315-9853

info@mywordsolution.com

Ask Basic Finance Expert

The Feldwyn Company is using a machine whose original cost was $72,000. The machine is two years old and has a current market value of $16,000. The asset is being depreciated over a 12 year original life toward a zero estimated final salvage value. There are no taxes associated with the sale of the old machine. Depreciation is on a straight-line basis.

Management is contemplating the purchase of a replacement that costs $75,000 and has an estimated salvage value of $10,000. The new machine will have a greater capacity and annual sales are expected to increase by $10,000. Operating efficiency with the new machine will also produce expected saving of $10,000 per year. Depreciation is on a straight-line basis over a ten year life.

Should the firm replace the asset, if the appropriate discount rate for the machine is 8% and the tax rate is 50%?

Basic Finance, Finance

  • Category:- Basic Finance
  • Reference No.:- M940624

Have any Question? 


Related Questions in Basic Finance

I need someone to write my outline heshe can pick any topic

I need someone to write my outline. He/She can pick any topic from the book. Please let me know ASAP. The instructions: D. Research Paper: The research paper should discuss a topic related to fund or non-profit accountin ...

You are chairperson of the investment fund for the eastern

You are chairperson of the investment fund for the Eastern Football League. You are asked to set up a fund of semiannual payments to be compounded semiannually to accumulate a sum of $100,000 after 10 years at an 8 perce ...

The probability that a flight departs sydney kingsford

The probability that a flight departs Sydney Kingsford Smith Airport on-time is 0.52. If Singapore Airlines flight SQ232 from Sydney to Singapore departs on-time, the probability that it arrives on-time is 0.69. If it do ...

Inflation was 8 percent during the most recent year and

Inflation was 8 percent during the most recent year and your organization's investment in land rose 12 percent. If the beginning appraised land value was $1,000,000, what increase in specific prices over general price le ...

A suppose you are hiring a worker for your firm you

a. Suppose you are hiring a worker for your firm. You advertise a position for $50,000, but an applicant offers to work for $40,000. Should you jump at this offer? b. Suppose you have $1000 to lend and offer it for 10-pe ...

For this assignment you will analyze a home mortgage loan1

For this assignment, you will analyze a home mortgage loan. 1. Find a description, asking price, and real estate taxes of a house for sale, and decide on a purchase price you would be willing to pay (assuming you have th ...

What were the principal conclusions of the business

What were the principal conclusions of the Business Roundtable CICE Study of the U.S. construction industry?

If the public chooses to hold no currency does the fed

If the public chooses to hold no currency, does the Fed control the money supply? If depository institutions choose to always loan up, does the Fed have precise control? If both of these situations occur, does the Fed ha ...

Lambda corporation has current liabilities of 430000 a

Lambda Corporation has current liabilities of $430,000, a quick ratio of 1.7, inventory turnover of 4.9, and a current ratio of 3.4. What is the cost of goods sold for Lambda Corporation?

Homework set2015 strayer university all rights reserved

Homework Set 2015 Strayer University. All Rights Reserved. This document contains Strayer University Confidential and Proprietary information and may not be copied, further distributed, or otherwise disclosed in whole or ...

  • 4,153,160 Questions Asked
  • 13,132 Experts
  • 2,558,936 Questions Answered

Ask Experts for help!!

Looking for Assignment Help?

Start excelling in your Courses, Get help with Assignment

Write us your full requirement for evaluation and you will receive response within 20 minutes turnaround time.

Ask Now Help with Problems, Get a Best Answer

A cola-dispensing machine is set to dispense 9 ounces of

A cola-dispensing machine is set to dispense 9 ounces of cola per cup, with a standard deviation of 1.0 ounce. The manuf

What is marketingbullwhat is marketing think back to your

What is Marketing? • "What is marketing"? Think back to your impressions before you started this class versus how you

Question -your client david smith runs a small it

QUESTION - Your client, David Smith runs a small IT consulting business specialising in computer software and techno

Inspection of a random sample of 22 aircraft showed that 15

Inspection of a random sample of 22 aircraft showed that 15 needed repairs to fix a wiring problem that might compromise

Effective hrmquestionhow can an effective hrm system help

Effective HRM Question How can an effective HRM system help facilitate the achievement of an organization's strate