Answer all please A company is considering the purchase of equipment costing $84000 which will permit it to reduce its e

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answerhappygod
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Answer all please A company is considering the purchase of equipment costing $84000 which will permit it to reduce its e

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Answer all please
A company is considering the purchase of equipment costing
$84000 which will permit it to reduce its existing labour cost by
$21000 each year for twelve years. The company estimates that it
will have to spend $2000 every two years overhauling the equipment.
The equiment may be depreciated using straight line depreciation
over 12 years for tax purposes. The company tax rate is 30 cents in
the dollar and the after corporate tax cost of capital is 10% per
annum.
Assume:
What is the NPV to the nearest dollar? Be careful not to round
until the last calculation.
=> Use the following information to estimate the taxable
income for year 5.
Unit price for sales in years 1 to 3: $50 and for years 4 to 6:
$45
Variable Cost (VC) : $25 per unit
Fixed Cost (FC) : $50 000 per year
Initial Investment: $600 000
Salvage: $50 000 at the end of year 6
tax rate: 34%
cost of capital 15%
depreciation method: prime cost to zero
$770,000
$650,000
$670,000
$875,000
$720,000
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