Sharpe Machining Company purchased industrial tools costing $100,000, which fall in the 3-year property class under MACRS. Use Appendix A and Exhibit 16-9 for your reference. Note: Use appropriate factor(s) from the tables provided. Required: 1. Prepare a schedule of depreciation deductions assuming: a. The firm uses the accelerated depreciation schedule specified by MẶCRS. b. The firm uses the optional straight-line depreciation method and the half-year convention. 2. Calculate the present value of the depreciation tax shield under each depreciation method listed in requirement 1. Sharpe Machining Company's after-tax hurdle rate is 12 percent, and the firm's tax rate is 30 percent. Complete this question by entering your answers in the tabs below. Reg 1A Req 18 Reg 2 Calculate the present value of the depreciation tax shield under each depreciation method listed in requirement 1. Sharpe. Machining Company's after-tax hurdle rate is 12 percent, and the firm's tax rate is 30 percent. Note: Round your final answers to the nearest dollar amount. Under MACRS Accelerated depreciation Under MACRS Straight-line depreciation Present Value of Depreciation Tax Shield $ S < 10 36,184 37,290 < Prev Next > Che
Sharpe Machining Company purchased industrial tools costing $100,000, which fall in the 3-year property class under MACRS. Use Appendix A and Exhibit 16-9 for your reference. Note: Use appropriate factor(s) from the tables provided. Required: 1. Prepare a schedule of depreciation deductions assuming: a. The firm uses the accelerated depreciation schedule specified by MẶCRS. b. The firm uses the optional straight-line depreciation method and the half-year convention. 2. Calculate the present value of the depreciation tax shield under each depreciation method listed in requirement 1. Sharpe Machining Company's after-tax hurdle rate is 12 percent, and the firm's tax rate is 30 percent. Complete this question by entering your answers in the tabs below. Reg 1A Req 18 Reg 2 Calculate the present value of the depreciation tax shield under each depreciation method listed in requirement 1. Sharpe. Machining Company's after-tax hurdle rate is 12 percent, and the firm's tax rate is 30 percent. Note: Round your final answers to the nearest dollar amount. Under MACRS Accelerated depreciation Under MACRS Straight-line depreciation Present Value of Depreciation Tax Shield $ S < 10 36,184 37,290 < Prev Next > Che
Century 21 Accounting General Journal
11th Edition
ISBN:9781337680059
Author:Gilbertson
Publisher:Gilbertson
Chapter19: Accounting For Plant Assets, Depreciation, And Intangible Assets
Section19.2: Calculating Depreciation Expense
Problem 1WT
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