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Your company may buy a used pick-up for $15,000. During the truck's five year useful...

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Accounting

Your company may buy a used pick-up for $15,000. During the truck's five year useful life, it is estimated the firm will save $4,000 per year after all of the costs of owning and operating the truck have been paid. The truck's salvage value is estimated to be $3,000. Assume straight line depreciation and a tax rate of 35%. Assume r of 10%. Use excel and show formulas to create a model that will calculate before-tax and after-tax cash flows. Perform the same analysis on another tab of your spreadsheet using a tax rate of 39%.

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