Investment analysis for & decision-making
Assignment 02
Tran Van Trung Hieu
Batch 9
E1000125
Grade
(Only the use of office)
TASKS FOLDER
SUBJECT CODE: FIN204
STUDENT No.: E1000125
Date received
(Only the use of office)
STUDENT NAME: TRAN VAN TRUNG HIEU
PROGRAM: year 2, semester 2
INTAKE:
Subject name: Investment Analysis & decision-making |
Mission number: 2 |
Due date of assignment: 15 April 2013 date of submission: 3 June 2013 |
DECLARATION: I declare that
* No part of this mission has been copied from someone else's work except where due acknowledgment is made in the text, and
* No part of this mission has been written for me by any other person except where such cooperation have been approved by the lecturer concerned.
Signature ... date ...
N.B.
* Moderator has and may exercise the right to not select the assignment if the above explanation has not been signed.
* If the above explanation turns out to be false, no land to be assigned for this task.
Question 1:
Maplewood creations is considering to buy a new truck to replace an old truck which has a book value of $ 2,500 and $ 800 market value. The annual depreciation costs on the old truck was $ 500. The new truck, which will cost $ 29,000, will reduce operating costs $ 9000 per year over its 6-year economic life. The truck has a 5-year MACRS life and an estimated residual value at the end of 6 years of $ 2,000. About Maplewood has a 40% marginal tax rate and a hurdle rate of 12%, what is the NPV of the truck? Use the depreciation schedule listed below:
(5-year depreciation schedule: 20%, 32%, 19%, 12%, 12%, 5%)
Answer:
Year | 0 | 1 | 2 | 3 | 4 | 5 | 6 |...
