Logo
Home Study Material Contact Search
AI Chat FREE
  1. business
  2. accounting
  3. please include all steps and answers. thanks. hen

Please include all steps and answers. Thanks. Henredon purchases a high-precision programmable router for...

70.2K

Verified Solution

Question

Accounting

image

Please include all steps and answers. Thanks.

Henredon purchases a high-precision programmable router for shaping furniture components for $190,000. It is expected to last 12 years and have a salvage value of $5,000. Henredon will borrow $100,000 at 13% over 6 years, paying only interest each year and paying all the principal in the 6th year. It will produce $45,000 in net revenue each year during its life. All dollar amounts are expressed in real or constant dollars. Depreciation follows MACRS 7-year property, taxes are 25%, the real after-tax MARR is 10%, and inflation is 3.9%. 4(a) Determine the then-current or actual after-tax cash flows for each year. 4(b) Determine the PW of the after-tax cash flows. 4(c) Determine the AW of the after-tax cash flows. 4(d) Determine the FW of the after-tax cash flows. 4(e) Determine the combined IRR of the after-tax cash flows. 4(g) Determine the real IRR of the after-tax cash flows

Answer & Explanation Solved by verified expert
Get Answers to Unlimited Questions

Join us to gain access to millions of questions and expert answers. Enjoy exclusive benefits tailored just for you!

Membership Benefits:
  • Unlimited Question Access with detailed Answers
  • Zin AI - 3 Million Words
  • 10 Dall-E 3 Images
  • 20 Plot Generations
  • Conversation with Dialogue Memory
  • No Ads, Ever!
  • Access to Our Best AI Platform: Flex AI - Your personal assistant for all your inquiries!
Become a Member

Other questions asked by students