Daisy Company is considering the purchase of equipment for $400,000. The equipment will have a...
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Accounting
Daisy Company is considering the purchase of equipment for $400,000. The equipment will have a ten year life with no terminal salvage value. Straight - line lepreciation will be used for tax purposes. It is expected that the equipment will generate annual sales of $180,000 and annual production costs, exclusive of lepreciation, of $120,000. The tax rate is 40%. What is the net annual after - tax cash flow from the equipment? A. $52,000 cash inflow B. $60,000 cash inflow C. $16,000 cash inflow D. $36,000 cash inflow
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