Your firm needs a machine which costs $110,000, and requires $26,000 in maintenance for each year of
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Question:
Your firm needs a machine which costs $110,000, and requires $26,000 in maintenance for each year of its 5 year life. After 3 years, this machine will be replaced. The machine falls into the MACRS 5-year class life category. Assume a tax rate of 30% and a discount rate of 15%. What is the depreciation tax shield for this project in year 5?
A. $21,120
B. $3,168.00
C. $14,784
D. $6,336.00
Related Book For
Finance Applications and Theory
ISBN: 978-0077861681
3rd edition
Authors: Marcia Cornett, Troy Adair
Posted Date: