Ferryman Example 4 (MACRS Depreciation)

Ferryman Example 4 - produce Assume that O&M costs are $10 million in 2005 and grow by $1 million per year after that At the end of 10 years

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Ferryman Example 4 (MACRS Depreciation) In 2004, Ferryman Company, a titanium producer in Pennsylvania, expanded its operations with the purchase of a $10 million rolling mill. Assume the new mill was fired up at the start of 2005 and runs at its peak capacity of 4 million pounds of output per year for 10 years. Assume that each pound of output generates $9.00 in revenues while costing $4.00 to
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Unformatted text preview: produce. Assume that O&M costs are $10 million in 2005 and grow by $1 million per year after that. At the end of 10 years the mill will be sold for scrap for $500,000. Calculate the depreciation amount they can claim for 2007 and the book value at the end of 2007 using the MACRS with a 10-year recovery period....
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This note was uploaded on 12/07/2011 for the course CIVL 4111 taught by Professor Moore,l during the Fall '08 term at U. Memphis.

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