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Question Leumax Inc. contemplating the purchase of a new caterpillar machine.

Question : Question Leumax Inc. contemplating the purchase of a new caterpillar machine. : 1030613

Question

Leumax Inc. is contemplating the purchase of a new caterpillar machine. The machine will cost $180,000. Its market value at the end of five years is estimated as $40,000. The accounting department uses the straight line method to depreciate the equipment. The justification for this machine includes $40,000 savings per year in labor and $30,000 savings per year in reduced material. The before-tax MARR is 40%. Use this information to solve problems 8 and 9. The taxable income for year three is most nearly: $42,000 $5,010 $16,000 $28,000 $38,000 The total before-tax cash flow in year five is most nearly: $9,0000 $40,000 $70,000 $80,000 $110,000

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Finance 9 Months Ago 47 Views
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