Sheetband & Halyard Inc The Correct Answer

Sheetband & Halyard Inc The Correct Answer - Yards...

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Unformatted text preview: Yards Sold 100,000 Price per Yard $30 Year 1 Revenue $3,000,000.00 - Cost of Goods Sold 2,100,000.00 - Depreciation on Plant 50,000.00 - Depreciation on Machinery 200,000.00 Taxable Income $650,000.00 - Tax (t=.35) 227,500.00 Net Income $422,500.00 + Depreciation Expense $250,000.00 Operating Cash Flow $672,500.00 Gross Plant Refurbishment $(500,000.00) $500,000.00 - Accumulated Depreciation 50,000.00 Net Plant Refurbishment $450,000.00 10-year ACRS Schedule 0.1 Depreciation Expense Plant 50,000.00 Plant Write OFF Tax Rate Plant Tax Savings Gross Machinery $(1,000,000.00) $1,000,000.00 - Accumulated Depreciation 200,000.00 Net Machinery $800,000.00 5-year ACRS Schedule 0.2 Depreciation Expense Machinery 200,000.00 Machinery Write OFF Tax Rate Machinery Tax Savings Working Capital (10% Sales) $300,000.00 $300,000.00 Change in Working Capital $(300,000.00) $- Sale of Land @ $600,000- Book Value Gain on Sale Scrap - BV Tax on Gain (t=35%) t(gain) Cash Flow from Sale of Land Scrap - tax Net Cash Flow $(1,800,000.00) $672,500.00 PV of CF (1,800,000.00) 600,446.43 Cumulative PV (1,800,000.00) (1,199,553.57) Sale of Land @ $1,500,000- Book Value Gain on Sale...
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This note was uploaded on 09/25/2010 for the course FINE FINE 2000 taught by Professor Mingdong during the Winter '10 term at York University.

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Sheetband & Halyard Inc The Correct Answer - Yards...

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