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We are thinking abut buying a widget fogger. It would cost $16,000 to purchase and $4,000 to install. It would be subject to a 5% investment tax credit. The fogger is in the SACRS(20%, 30%, 25%, 25%) class. We would use it for 5 years and sell it for $1,600. The fogger would raise our revenues by $6,000 per year and raise our expenses by $800 per year. Our tax rate is 20%. . (a) Write the depreciation table, and calculate the after-tax cash flow from the sale of the fogger. (b) Calculate all the cash flows from the purchase, use, and sale of the fogger.

Financial Management, Finance

  • Category:- Financial Management
  • Reference No.:- M92340382

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