1. Consider a corporate tax system that uses the declining-balance method for determining depreciation for tax purposes. Assume that the applicable rate is 60 percent and the tax life of the asset is 3 years. If a corporation purchases a depreciable asset for $20,000, what depreciation deduction is allowed in each year of this asset's use?

Please enter your numeric answers below.If necessary, round to the nearest dollar.Do not include the dollar sign or any commas.

Year 1: $

Year 2: $

Year 3: $

2.David saves $3000of his Year 1 income to spend in Year 2.The interest rate is 12 percent, the tax rate that applies to interest income is 30 percent, and the sales tax rate is 10 percent.If David spends all available funds in Year 2, how much will he pay in taxes on his interest income and how much will he pay in sales taxes?

Please fill in the blanks below with your numeric answers.Do not include the dollar sign.If necessary, please round to the nearest dollar.

David will pay $____in taxes on his interest income.

David will pay $____in sales taxes.