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Your company is considering a new project that will require $902.000 million of new equipment at the start of the project. The equipment will have a depreciable life of 8 years and will be depreciated to a book value of $158,000 using straight-line depreciation. Neither bonus depreciation nor Section 179 expensing will be used. The cost of capital is 11 percent, and the firm's tax rate is 21 percent. Estimate the present value of the tax benefits from depreciation. (Round your answer to 2 decimal places.) Present value 143.576.83 Your company is considering a new project that will require $902.000 million of new equipment at the start of the project. The equipment will have a depreciable life of 8 years and will be depreciated to a book value of $158,000 using straight-line depreciation. Neither bonus depreciation nor Section 179 expensing will be used. The cost of capital is 11 percent, and the firm's tax rate is 21 percent. Estimate the present value of the tax benefits from depreciation. (Round your answer to 2 decimal places.) Present value 143.576.83
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Related Book For
Financial Reporting Financial Statement Analysis and Valuation a strategic perspective
ISBN: 978-1337614689
9th edition
Authors: James M. Wahlen, Stephen P. Baginski, Mark Bradshaw
Posted Date:
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