The market value of a presently owned machine in a wind turbine manufacturing plant is $130,000. It has annual operating costs of $64,000 with no salvage value after its remaining life of 3 years. The depreciation for the next 3 years will be $69,960, $49,960, and $35,720. Assume the effective tax rate is 25% and its after-tax MARR is 12%. A PW relation for comparing the defender against a challenger that also has a 3-year life is being developed. Determine the after-tax cash flow value for year 2 only used in the PW relation. The after-tax cash flow value for year 2 only used in the PW relation is $-

The market value of a presently owned machine in a wind turbine manufacturing plant is $130,000. It has annual operating costs of $64,000 with no salvage value after its remaining life of 3 years. The depreciation for the next 3 years will be $69,960, $49,960, and $35,720. Assume the effective tax rate is 25% and its after-tax MARR is 12%. A PW relation for comparing the defender against a challenger that also has a 3-year life is being developed. Determine the after-tax cash flow value for year 2 only used in the PW relation. The after-tax cash flow value for year 2 only used in the PW relation is $-

Cornerstones of Cost Management (Cornerstones Series)

4th Edition

ISBN:9781305970663

Author:Don R. Hansen, Maryanne M. Mowen

Publisher:Don R. Hansen, Maryanne M. Mowen

Chapter19: Capital Investment

Section: Chapter Questions

Problem 18E

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