You must evaluate a proposal to buy a new milling machine. The base price is $135,000 and shipping and installation costs would add another $8,000. The machine falls into the MACRS 3-year class, and it would be sold after 3 years for $94,500. The applicable depreciation rates are 33%, 45%, 15%, and 7% as discussed in Appendix 12A. The machine would require a $5,000 increase in net operating working capital (increased inventory less increased accounts payable). There would be no effect on revenues, but pretax labor costs would decline by $52,000 per year. The marginal tax rate is 35%, and the WACC is 8%. Also, the firm spent $4,500 last year investigating the feasibility of using the machine. a. How should the $4,500 spent last year be handled
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While on vacation in las vegas jennifer, who is from utah, wins a progressive jackpot playing cards worth $15,875 at the casino royale. what implication does she encounter when she goes to collect her prize?
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On january 1, 2017, sophie's sunlounge owned 4 tanning beds valued at $20,000. during 2017, sophie's bought 3 new beds at a total cost of $14 comma 000, and at the end of the year the market value of all of sophie's beds was $24 comma 000. what was sophie's net investment
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If a product goes up in price, and the demand for it drops, that product's demand is a. elastic b. inelastic c. stable d. fixed select the best answer from the choices provided
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You must evaluate a proposal to buy a new milling machine. The base price is $135,000 and shipping a...
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