Entering into a new industry involves substantial risks and costs because a company must make the huge investment necessary to develop the set of value-chain activities required to make and sell. this is why joint ventures are commonly used to enter a(n)

Anew equipment has been proposed by engineers to increase the productivity of a certain manual welding operation. the investment cost is $25,000, and the equipment will have a market value of $5,000 at the end of a study period of five years. increased productivity attributable to the equipment will amount to $10,000 per year after operating costs have been subtracted from the revenue generated by the additional production. if marr is 10%, is investing in this equipment feasible? use annual worth method.

Case in point 2.4 attaway airlines, part two back at attaway airlines, the morning meeting ended with no agreement between dan esposito and molly kinnon. in fact, a new issue arose. molly now says that the new accounting system is entitled to the highest priority because the federal government soon will require the reporting of certain types of company-paid health insurance premiums. because the current system will not handle this report, she insists that the entire accounting system is a nondiscretionary project. as you might expect, dan is upset. can part of a project be nondiscretionary? what issues need to be discussed? the committee meets again tomorrow, and the members will look to you, as the it director, for guidance.

Bridgeport company began operations at the beginning of 2018. the following information pertains to this company. 1. pretax financial income for 2018 is $115,000. 2. the tax rate enacted for 2018 and future years is 40%. 3. differences between the 2018 income statement and tax return are listed below: (a) warranty expense accrued for financial reporting purposes amounts to $7,500. warranty deductions per the tax return amount to $2,200. (b) gross profit on construction contracts using the percentage-of-completion method per books amounts to $94,700. gross profit on construction contracts for tax purposes amounts to $67,100. (c) depreciation of property, plant, and equipment for financial reporting purposes amounts to $61,800. depreciation of these assets amounts to $75,700 for the tax return. (d) a $3,600 fine paid for violation of pollution laws was deducted in computing pretax financial income. (e) interest revenue recognized on an investment in tax-exempt municipal bonds amounts to $1,500. 4. taxable income is expected for the next few years. (assume (a) is short-term in nature; assume (b) and (c) are long-term in nature.) (a) prepare the reconciliation schedule for 2017 and future years. (b) prepare the journal entry to record income tax expense for 2017. (c) prepare the income tax expense section of the income statement beginning with “income before income taxes.” (d) determine how the deferred taxes will appear on the balance sheet at the end of 2017.