Order the answer to: A group of businessmen formed a corporation

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business-economics

Order the answer to: A group of businessmen formed a corporation

Question A group of businessmen formed a to lease for 5 years a piece of land at the intersection of two busy streets. The has invested $50,000 in car-washing equipment. They will depreciate the equipment by sum-of-years’-digits , assuming a $5000 at the end of the 5 year useful life. The is expected to have a before-tax cash flow, after meeting all expenses of operation (except ), of $20,000 the first year, declining $3000 per year in future years (second year = $17,000, third year = $14,000, etc.). The has other income, so it is taxed at a combined corporate tax rate of 20%. If the projected income is correct, and the equipment can be sold for $50oo.at the end of 5 years, what after-tax rate of return would the receive from this venture?
Subject business-economics
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