3232ex11-3 - 3232ex11-3 Info: Purchase: 18,000 O&M (yr...

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3232ex11-3 Info: Purchase: 18,000 4000 Salvage (yr 1) 10,000 Salvage decreases at 25%/yr compounded Max life (yrs) 7 Mandatory O/H (during yr 5) 5000 MARR 15% Marginal Tax Rate: 40% CCA Class 43 30% Determine the economic life
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Consider the statements through the first year only Year 0 1 Income Statement Revenue Expense 4000 CCA 30% 2700 Taxable Income -6700 Tax 40% -2680 Net Income -4020 Cash Flow Statement Operating Activities Net Income -4020 CCA 2700 Investment Activities Asset Purchase -18000 Salvage 10000 Disposal Tax Effect 2120 Net Cash Flow -18000 10800 UCC 18000 15300 Generalized Cash Flow: (-0.6)*O&M -2400 Simplified Tabular Format (0.4)*CCA 1080 Investment -18000 Net Sale Proceeds 12120 Net Cash Flow -18000 10800
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Tabular Format Data: Year O/H UCC CCA A/T CCA Tot. Oper. Costs Market Value Disp Tx Net Sale Proceeds 0 18,000.00 1 4,000.00 -2,400.00 15,300.00 2,700.00 1,080.00 -1,320.00 10,000.00 2,120.00 12,120.00 2 5,600.00 -3,360.00 10,710.00
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3232ex11-3 - 3232ex11-3 Info: Purchase: 18,000 O&M (yr...

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