Saturday
April 18, 2015

Homework Help: strategic ffinancial mangement

Posted by shruti sieth on Sunday, March 10, 2013 at 5:01am.

XYZ company is contemplating the purchase of a new machinery costing rupees 30000with an expected life of 5 year at the end of which period , it can be solved for rupees 750 thousand in replacement of an old machine purchased 3 years ago for rupees 15000 with an expected life spend of 8 years, the company adopt the system of providing deprecation on machinery on reducing balance method because of the purchase of new machine annual profit before depreciation are expected to increase by rupees 6000. The present market value of the old machinery is rupees 16250 decide whether the company should go ahead with the plan for acquisition of new machinery if:-The average tax on income was to be 55%.The average rate of tax on capital gain was to be 40%.The cost of capital to the business was 12%.Present value of 1 rupees at a discount of 12% is .9,.8,.7,.6,.5,.45,.4 for the year 1-8 respectively.

Answer this Question

First Name:
School Subject:
Answer:

Related Questions

mathyeshoda - salman purchased 8 wood panels for rupees 1500 each for ...
math school g - salman purchased 8 wood panels for rupees 1500 each for ...
economics cost analysis - The XYZ corporation is planning to purchase an ...
maths-ARITHMETIC PROGRESSIONS - A person buys a refrigerator for rupees 12000. ...
maths-urgently needed - A person buys a refrigerator for rupees 12000. He pays ...
Capital Budgeting - A company has revenues of 100 per unit sold. Current sales ...
accounting - amair started the business with a capital of rs60000 on 1jan 2009 ...
econ - In January 2012, one US dollar was worth 50 Indian rupees. Suppose that ...
mathematiczzzzzz plzzzzzzzzzzzzzzz g - manju bought a second hand cycle for ...
Eco - In January 2012, one US dollar was worth 50.0 Indian rupees. Suppose that ...

Members