Business, 24.05.2021 20:30 Rainbowface33
Firm A uses straight-line depreciation. Firm B uses MACRS depreciation. Both firms bought $75,000 worth of equipment last year that has a tax life of 5 years. The 5-year MACRS percentage rates, starting with Year 1, are: 20, 32, 19.2, 11.52, 11.52, and 5.76. Both firms have a marginal tax rate of 34 percent and identical operating cash flows except for the depreciation effects. Given this, you know the:___.
A) operating cash flow of Firm A is greater than that of Firm B for Year 3.
B) depreciation expense for Firm A will be greater than Firm B's expense every year.
C) market value of Firm B's equipment is greater than the market value of Firm A's equipment at the end of Year 2.
D) equipment has a higher value on Firm B's books than on Firm A's at the end of Year 2.
E) market value of Firm A's equipment is greater than the market value of Firm B's at end the first year.
Answers: 2
Another question on Business
Business, 22.06.2019 09:40
Henry crouch's law office has traditionally ordered ink refills 55 units at a time. the firm estimates that carrying cost is 35% of the $11 unit cost and that annual demand is about 240 units per year. the assumptions of the basic eoq model are thought to apply. for what value of ordering cost would its action be optimal? a) for what value of ordering cost would its action be optimal?
Answers: 2
Business, 22.06.2019 12:50
Salaries are $4,500 per week for five working days and are paid weekly at the end of the day fridays. the end of the month falls on a thursday. the accountant for dayton company made the appropriate accrual adjustment and posted it to the ledger. the balance of salaries payable, as shown on the adjusted trial balance, will be a (assume that there was no beginning balance in the salaries payable account.)
Answers: 1
Business, 22.06.2019 17:50
What additional information about the numbers used to compute this ratio might be useful in you assess liquidity? (select all that apply) (a) the maturity schedule of current liabilities (b) the average stock price for the industry (c) the average current ratio for the industry (d) the amount of current assets that is concentrated in relatively illiquid inventories
Answers: 3
You know the right answer?
Firm A uses straight-line depreciation. Firm B uses MACRS depreciation. Both firms bought $75,000 wo...
Questions
Mathematics, 16.04.2020 00:29
History, 16.04.2020 00:29
Biology, 16.04.2020 00:29
Chemistry, 16.04.2020 00:29
Mathematics, 16.04.2020 00:29
