Im completely lost with this

SoccerBoss
Category:
Accounting
Price: $20 USD

Question description

Manning Corporation is considering a new project requiring a $94,000 investment in test equipment with no salvage value. The project would produce $74,000 of pretax income before depreciation at the end of each of the next six years. The company’s income tax rate is 40%. In compiling its tax return and computing its income tax payments, the company can choose between the two alternative depreciation schedules shown in the table. (PV of $1FV of $1PVA of $1, and FVA of $1(Use appropriate factor(s) from the tables provided.) 

 

Straight-Line
Depreciation
MACRS
Depreciation
Year 1$9,400$18,800
Year 218,80030,080
Year 318,80018,048
Year 418,80010,829
Year 518,80010,829
Year 69,4005,414
Totals$94,000$94,000




Complete the following table assuming use of straight-line depreciation. Net cash flow equals the amount of income before depreciation minus the income taxes.


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(Top Tutor) Daniel C.
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School: Cornell University
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