Question: 2 . You plan on buying a bottling machine for $ 2 million, which can be salvaged for $ 4 0 0 , 0 0

2. You plan on buying a bottling machine for $2 million, which can be salvaged for
$400,000 in 8 years. Your tax rate is 43% and the CCA rate is 30%. Your cost of
capital is 13%. What is present value of the CCA tax sheild? (Answer: E)
a. $338,447
b. $378,521
c. $422,781
d.$458,402
e. $520,348

Step by Step Solution

There are 3 Steps involved in it

1 Expert Approved Answer
Step: 1 Unlock blur-text-image
Question Has Been Solved by an Expert!

Get step-by-step solutions from verified subject matter experts

Step: 2 Unlock
Step: 3 Unlock

Students Have Also Explored These Related Finance Questions!

Q:

HISARNA - DEVELOPING A SUSTAINABLE STEEL PRODUCTION PROCESS ABSTRACT The steel industry in Europe was looking for a way to increase the efficiency of steel production, and redesign the production...

Q:

1 . You have invested $ 4 , 5 0 0 in an account that earns 8 % compounded semi - annually. You plan on making additional payments of $ 7 5 per month into this account for the next five years. How...

Q:

I need only answers within an hour Question 1 "Part of the income generated by an ice cream machine is saved to purchase a new machine in the future. If $6,233 is deposited annually at 5% interest,...

Q:

I have attached the assignment copy again along with the solution I needed to be double checked. Thanks AFF 210 Assignment Two Summer 2017 STUDENT NAME __________________________ STUDENT NUMBER...

Q:

Find solutions to the following questions The directors of Merchant pic are considering a five year project that has been proposed by the company's sales director. A customer is about to sell a very...

Q:

Am stuck in this question, kindly help get answers The directors of Merchant pic are considering a five year project that has been proposed by the company's sales director. A customer is about to...

Q:

QUESTION-1 A project requires an initial investment of $15,000 and has annual cash flows of $3,000 for 20 years. If the discount rate is 10%, what is the discounted payback period? Multiple Choice 5...

Q:

Jskinen Oy has just today paid for and installed a special machine for polishing cars at one of its several outlets. It is the first day of the company's fiscal year. The machine cost 20 000. Its...

Q:

Jskinen Oy has just today paid for and installed a special machine for polishing cars at one of its several outlets. It is the first day of the company's fiscal year. The machine cost 20 000. Its...

Q:

Jskinen Oy has just today paid for and installed a special machine for polishing cars at one of its several outlets. It is the first day of the companys fiscal year. The machine cost 20 000. Its...

Q:

Lance's Engineering Consulting reports the following direct labor information for clerical staff: Month: March Standard Rate $25 per Hour Actual Rate Paid $27 per Hour Standard Hours Allowed for...

Q:

You may read one approved book and complete a reading log and book report to be turned in no later than the day stated on the syllabus! The reading log must be submitted on paper and kept as you read...

Q:

Calculating EAC A five-year project has an initial fixed asset investment of $240,000, an initial NWC investment of $20000, and an annual OCF of $32,000. The fixed asset is fully depreciated over the...

Q:

7.19 A random variable X has the Poisson distribution p(x; ) = e x /x! for x = 0, 1, 2, . . . . Show that the moment-generating function of X is MX (t) = e(e t 1) . Using MX (t), find the mean and...

Q:

CT Corp Comprehensive Question Canadian Tire Corporation, Limited (Canadian Tire) is a family of companies that includes a retail segment and a financial services division, among others. The retail...

Q:

12-14 On what business functions and level of decision making is GE focusing?

Q:

12-16 To what extent is GE becoming a software company? Explain your answer.

Q:

12-18 Give three examples of data used in location analytics and explain how each can help businesses.