A new piece of machinery, when placed in service is estimated to cost $225,000. It is expected to produce revenue of $75,000 and operating and maintenance expenses are expected to be $9,000 per year. The useful life of the equipment is 5 years and it expected to have a $35,000 market value at the end of the 5th year. Assume that the firm tax rate is 38%. The machinery is in the MCRS five-year property class.
What is the IRR _______ for the BTCF?
What is the NPW ______ of the ATCF if MARR = 10%?
What is the tax _________ on the Depreciation Recapture?