It would be subject to a 5 investment tax credit the fogger


We are thinking abut buying a widget fogger. It would cost $16,000 to purchase and $4,000 to install.

It would be subject to a 5% investment tax credit. The fogger is in the SACRS(20%, 30%, 25%, 25%) class. We would use it for 5 years and sell it for $1,600.

The fogger would raise our revenues by $6,000 per year and raise our expenses by $800 per year. Our tax rate is 20%. .

(a) Write the depreciation table, and calculate the after-tax cash flow from the sale of the fogger.

(b) Calculate all the cash flows from the purchase, use, and sale of the fogger.

Request for Solution File

Ask an Expert for Answer!!
Financial Management: It would be subject to a 5 investment tax credit the fogger
Reference No:- TGS02820999

Expected delivery within 24 Hours