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ACC - Misc. Multiple Problems




Question;3. A company has expected expenses (utilities, etc.) of $50,000/year. Its two workers, each earn$25,000 per year and another employee who makes $14,000 plus $6,000 in overtime if salesreach $120, 000 in a year. The company?s product costs $4/L to produce and sells for $7/L. Whatis the minimum number of liters the store must sell to break even (note: at break-even: cost equalsrevenue, like the IRR). Hint: browse break-even.Good Luck Good Luck Good Luck4. Select the most preferable equipment (8years useful life, 12% rate) from the table below. Usetwo methods.Parameter EquipmentA B C DFirst Cost $25,000 $35,000 $20,000 $40,000Annual Costs $8,000 $6,000 $9,000 $5,000Salvage Value $2,500 $3,500 $2,000 $4,0005. A firm is planning purchasing one of the following two machines.A BInitial Cost $3,900 $5,500Salvage value $1,800 $3,100Useful life 10 years 13 yearsAnnual Maintenance $390 $275(year 1-8), $425(year 9-13)Interest rate 6% 6%a. What is the annual cost equivalence of A and B?b. What is the present worth of the costs of A and B?c. If machine A was to be purchased and kept forever without any change in the annualmaintenance costs, what would be the present worth of all expenditures?d. Using PW repeatability method, compare the worthiness of A and B.e. What is the annual straight line depreciation for A and B?f. What is the total straight line depreciation value of A and B after fifth year?g. Present your final results (a to f) in a table form.6. Last year AMTEG Inc. had $18.4 million in revenue, $1.5 million of operating expenses,$500,000 capital investment, 1.2 million non-operating expense, and depreciation expenses of$6.4 million. Using the corporate federal tax rates, what is the approximate federal tax thiscorporation will have to pay for this tax year?7. Senai Import Export Inc. sold a piece of equipment during the current tax year for $65,000. Thisequipment had a cost basis of $208,000 and the accumulated depreciation was $151,000. Assumethe effective income tax rate is 39%. Based on this information, what isa. the gain (loss) on disposal,b. the tax liability (or credit) resulting from this sale, andc. the tax liability (or credit) if the accumulated depreciation was $123,000 instead of$151,000?


Paper#42712 | Written in 18-Jul-2015

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