Meade Metals Inc. plans to start doing its own deliveries instead of using an ou

Question

Meade Metals Inc. plans to start doing its own deliveries instead of using an outside service for which it has been paying $150,000 per year. To make the change, Mead will purchase a $200,000 trick that will depreciate straight line over 10 years to a $40,000 salvage value. Annual operating expenses are estimated at $80,000, including insurance, fuel, and maintenance on the truck, as well as the cost of a driver. Management plans to sell the truck after five years for $100,000. Develop the projects five year cash flows. Meade

Explanation / Answer

good idea

after end of the years the trucks rate will be high and our profit will increas as per rate of truck

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