The depreciable value of an asset, under MACRS, is the ________. ...

[a0266361136]

The depreciable value of an asset, under MACRS, is the ________.
 
  A) current cost
  B) current cost minus salvage value
  C) the original cost plus installation
  D) the original cost plus installation costs, minus salvage value

Question 2

Given the information in Table 10.1 and 15 percent cost of capital,
  (a) compute the net present value.
  (b) should the project be accepted?
 
  What will be an ideal response?

[ynlevi]

Answer to Question 1

C

Answer to Question 2

(a) NPV = (1,000 / 0.15 ) x 1 - 1 / (1.15 )5 - 2,500
= 1,000  (3.352 ) - 2,500 = 852
(b) Since NPV > 0, the project should be accepted.

[a0266361136]

TYSM

[elyse44]

Excellent