Afarmer is considering the purchase or lease of a forklift. he can buy a new forklift or lease a new forklift. he believes that each forklift will provide the same service but the costs are different. he has provided the following information. inflation is assumed to be zero. assume that the lease payment is constant throughout the lease agreement. assume that the lease payment would be made at the beginning of the year and the lease ends at the end of the 10th year. the lessor will pay repairs and maintenance. also assume that this farmer could claim the tax deduction due to the lease payment when it is paid. the new forklift has a price of $11,400, a before-tax net return of -$6,100, an investment life of 10 years, and a terminal value of $8,000. if he was to lease the forklift the operating expenses for this tractor will be $3,500. suppose that the pre-tax rate of return is 6%, the marginal tax rate is 24%, and the irs allows him to depreciate the tractor over 14 years using the straight-line method. what is the npv of the purchased forklift?

Benton company (bc), a calendar year entity, has one owner, who is in the 37% federal income tax bracket (any net capital gains or dividends would be taxed at a 20% rate). bc's gross income is $395,000, and its ordinary trade or business deductions are $245,000. ignore the standard deduction (or itemized deductions) and the deduction for qualified business income. if required, round computations to the nearest dollar. a. bc is operated as a proprietorship, and the owner withdraws $100,000 for personal use. bc's taxable income for the current year is $ , and the tax liability associated with the income from the sole proprietorship is $ . b. bc is operated as a c corporation, pays out $100,000 as salary, and pays no dividends to its shareholder. bc's taxable income for the current year is $ , and bc's tax liability is $ . the shareholder's tax liability is $ . c. bc is operated as a c corporation and pays out no salary or dividends to its shareholder. bc's taxable income for the current year is $ , and bc's tax liability is $ . d. bc is operated as a c corporation, pays out $100,000 as salary, and pays out the remainder of its earnings as dividends. bc's taxable income for the current year is $ , and bc's tax liability is $ .

Peppy knows a lot about marketing, but not much about the legal or financial aspects of starting a new business. he wants to consult with a lawyer and accountant, but his budget is tight with all of the expenses involved in getting peppy's pizzazzeria up and running. peppy should: trust his basic instincts and try to put it together without the advice of lawyers and accountants. delay talking with a lawyer and accountant until the business has established a positive cash flow for at least one year. immediately hire full-time lawyers and accountants for his staff. consult with a lawyer and accountant even though the budget is tight.

The year-end financial statements of calloway company contained the following elements and corresponding amounts: assets = $34,000; liabilities = ? ; common stock = $6,400; revenue = $13,800; dividends = $1,450; beginning retained earnings = $4,450; ending retained earnings = $8,400. based on this information, the amount of expenses on calloway's income statement was