Queue De Castor Foods Is Considering the Purchase of a New

question 55

Multiple Choice

Queue de Castor Foods is considering the purchase of a new capital asset for $35,000.The asset has an economic life of three years, a CCA rate of 20%, and expected salvage value of $5,000.The project also requires an investment in net working capital of $4,500.Assume the asset class remains open after the asset is sold.The firm's cost of capital is 14% and marginal tax rate is 40%.What is the present value of the terminal after-tax cash flow (ECF_n) ?

• A)$2,319.20
• B)$6,412.23
• C)$9,900.48
• D)$10,505.26

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Definitions:

Assyrian Palace

Ancient palatial structures in the Assyrian Empire, characterized by their monumental architecture, extensive wall reliefs, and intricate decorative artworks.

Narrative Reliefs

Sculptural or carved artwork that tells a story through figures and scenes.

Nimrud

An ancient Assyrian city located in modern-day Iraq, noted for its archaeological significance and as a capital in the 9th to 7th centuries BC.

Perpetual Service

Refers to an ongoing, continuous service that does not have a planned end date.