Jasper company has a payback goal of three years on acquisitions. of new equipment. anew piece of equipment that costs $450,000 and a five- year life is being considered. straight-line (sl)depreciation will be used, with zero salvage value. jasper is subject to a 30% income tax rate. to meet the company’s payback goal after-tax, the equipment must generate reductions in annual cash operating costs of:

a. $60,000

b. $114,000

c. $150,000

d. 190,000

e. $200,000

The correct answer is D.

Explanation:

Giving the following information:

Jasper company has a payback goal of three years on acquisitions. Of new equipment. Anew piece of equipment that costs $450,000 and a five- year life is being considered. Straight-line (SL)depreciation will be used, with zero salvage value. Jasper is subject to a 30% income tax rate.

Depreciation= 450,000/5= 90,000

We need to reach a net cash flow of at least $150,000

Reduction on costs= 190,000

Depreciation= 90,000 (-)

EBIT= 100,000

Tax= 30,000 (-)

Depreciation=90,000

Net operating income=  160,000

whole quiz

1. the sum of all activities involved in getting high-quality products into the marketplace

2.operations

3. the principle of looking at the supply chain as a whole in order to improve the overall flow through the system.

4. produced; performed

5. activities producing tangible products, such as radios, newspapers, buses, and textbooks.

6. activities producing intangible and tangible products, such as entertainment, transportation, and education.

7.   customer focus

8. analyzing a competitor's products to identify desirable improvements

9. the systematic direction and control of the processes that transform resources into finished projects that create value for and provide benefits to consumers.

10. operation management.

your welcome leave a rate and a < 3