18. The Hobbit Company Ltd is considering replacing the equipment it uses to produce tents. The equipment would cost $1.4 million and lower manufacturing costs by an estimated $215,000 a year. The equipment will be depreciated using straight-line depreciation to a book value of zero. The life of the equipment is 8 years. The required rate of return is 13% and the tax rate is 34%. What is the net profit after tax from this proposed project?
B. $26,400 Correct
How to calculate the right answer?
Thanks for installing the Bottom of every post plugin by Corey Salzano. Contact me if you need custom WordPress plugins or website design.
The post The Hobbit Company Ltd is considering replacing the equipment it uses to produce tents. The equipment would cost .4 million and lower… first appeared on Submit Your Homeworks.