How do I calculate present value interest factor of annuity from this information.
The company plans to purchase a new piece of equipment (to be used over a six year period) for $320,000.
Assume the cash flows and depreciation (based upon the use of the 5-year MACRS Schedule and Table 12-9) for the new equipment is as follows:
Cash Flow Depreciation
1 $120,000 $64,000
2 105,000 102,400
3 80,000 61,440
4 65,000 36,800
5 53,000 36,800
6 45,000 18,560
The firm has a 36 percent tax rate. Assuming depreciation is the only expense and based upon the cost of capital of 10%
Another homework problem? You’ll really get more out of your education if you do your own work.
August 16th, 2009 at 9:31 am
Another homework problem? You’ll really get more out of your education if you do your own work.
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