in million) 700 850 1100 1000 800 1. The capital equipment required for manufacturing Gale costs Rs.600 million and it will be depreciated at the rate of 25 percent per year as per the WDV method for tax purposes. The expected net salvage value after 5 years is Rs.100 million. 2. The working capital requirement for the project is expected to be 10% of sales. Working capital level will be adjusted at the beginning of the year in relation to the sales for the year. At the end of
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multiplied by a fixed rate and is the most common rate which is use. When using the double-declining-balance-method the salvage value is not considered in determining the annual depreciation but the book value of the asset being depreciated is never brought below its salvage value‚ regardless of the method used. The process continues until the salvage value or the end of the asset’s useful life is reached. In the last year of depreciation a subtraction might be needed in order to prevent
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Also‚ he would not have to consider maintenance cost. Question 2: Calculate the net advantage to leasing (NAL) the restaurant equipment. It is assumed that the old equipment has no resale value whereas the new equipment would have a salvage value of $30‚000 after 5 years. The restaurant’s tax rate is estimated to be 40%. In order to properly compare the lease vs. buy decision we must be able to distinguish between the situations of owning and not owning the assets at the end of year five
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go to this address to get the tutorial: http://homeworkfox.com/tutorials/business/512/acc-423-week-5-wileyplus-assignment-exercises/ ACC 423 Week 5 WileyPlus Assignment - Exercises Business - Accounting ACC423 P13-9 P20-4 E21-7 P22-6 P13-9 (Premium Entries and Financial Statement Presentation) Sycamore Candy Company offers a CD single as a premium for every five candy bar wrappers presented by customers together with $2.50. The candy bars are sold by the company to distributors for 30
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CHAPTER 9 MAKING CAPITAL INVESTMENT DECISIONS Solutions to Questions and Problems 1. The $7 million acquisition cost of the land six years ago is a sunk cost. The $9.8 million current aftertax value of the land is an opportunity cost if the land is used rather than sold off. The $21 million cash outlay and $850‚000 grading expenses are the initial fixed asset investments needed to get the project going. Therefore‚ the proper year zero cash flow to use in evaluating this project is
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1. a. Delta Airlines Depreciation Method Depreciation Method Salvage Value For every $100 mil Depreciated Annual Depreciation Prior to 1986 Straight-line‚ 10 years 10% 100-(.1*100)=90 90/10=9 $9 mil 1968 – 1993 Straight-line‚ 15 years 10% 100-(.1*100)=90 90/15=6 $6 mil After 1993 Straight-line‚ 20 years 5% 100-(.05*100)=95 95/20=4.75 $4.75 mil b. Singapore Airlines Depreciation Method Depreciation Method Salvage Value For every $100 mil Depreciated Annual Depreciation Prior to 1989 Straight-line
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Financial Accounting for decision making Chapter 3 Homework 3-2. Are the following balance sheet items (A) assets‚ (L) liabilities‚ or (E) stockholders’ equity? A: Assests Liabilities Stockholder’s equity: c: Investments in stock d: Cash e: Land f: Inventory h: Marketable securities i: Patents m: Taxes payable p: Prepaid expenses q: Goodwill r: Tools s: Buildings a: Cash dividends payable b: Mortgage notes payable g: Unearned rent n: Account payable. o: Organizational costs j: Capital stock k:
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taken from their body and transplanted into someone else’s who because of some sort of medical condition‚ can not survive off of their own. At the time of death one’s heart‚ intestine‚ kidneys‚ liver‚ lung‚ pancreas‚ pancreas islet cell‚ heart valves‚ bone‚ skin‚ corneas‚ veins‚ cartilage‚ and tendons can all be used for transplantation. Choosing to donate organs is beneficial to many people‚ morally the right thing to do when you pass on and‚ is also one of the most important ways for survival of many
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officers eliminated and deferred current period expenses to inflate earnings. They assigned incorrect and inflated salvage value on their trucks while extending their useful lives to avoid depreciation expenses. Once landfills were filled with waste‚ they failed to record expenses for decreases in value. They gave random‚ unsupported salvage values to assets that previously had no salvage value. Unsuccessful and abandoned landfill development projects were not recorded as expenses or write-offs. Along
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depict the story of what naval divers did during the recovery process after the Japanese attack on Pearl Harbor‚ the hazards endured and the sometimes nearly impossible hardships they overcame‚ and the innovative diving techniques implemented used to salvage as many damaged battleships and naval capabilities back to fleet. The primary content also includes tense descriptions of diving after horrific circumstances‚ the human factors that are seldom known‚ and the grim tasks of recovering bodies in the
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