Previously, the emphasis was on obtaining information from clients. In this chapter, the emphasis was on preparing witnesses for trial. To properly prepare witnesses for trial, the paralegal needs to….
evaluate the proposed acquisition of a new special-purpose truck.
You have been asked by the president of your company to evaluate the proposed acquisition of a new special-purpose truck. The truck’s basic price is R20,000, and it will cost another R10,000 to modify it for special use by your firm. The truck falls uses straight-line depreciation and it will be sold after three years for R20,000. Use of the truck will require an increase in net working capital (spare parts inventory) of R2,000. The truck will have no effect on revenues, but it is expected to save the firm R20,000 per year in before-tax operating costs, mainly labour. The firm’s marginal tax rate is 40 percent. What is the terminal cash flow at the end of Year 3?