Question

Question2 :ABC company is
considering investment in a machine
that produces product P. The
machine will cost 9,00,000. In the
first year, 21,000 units of P will be
produced and the price will be '24
per unit. The volume is expected to
increase by 20% and the price of the
product by 25%. The material used to
manufacture the product is
becoming more expensive. The cost
of production is therefore expected
to increase by 15%. The production
cost in the first year will be . 16 per
unit. The company uses straight-line
depreciation on the machine for tax
purposes. There will be '75,000 as
salvage value at the end of 6-year life
of the machine. The tax rate is 30%
Calculate the cash inflows after tax
that is relevant for deciding whether
to accept the project or not.
Add file​

Answer 1

Answer:

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Explanation:

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