2. (25 points) Determine whether the following contract described below is worthwhile of undertaking after taxes if at the end of the 3-year of ownership the contract, you are expected to be able to sell the land and equipment. Use the Present Worth analysis under MARR of 15% and effective tax rate. Explanation Includes land and equipment Increasing by $10,000 for each year of useful life Capital investment: $400,000 Land investment: $300,000 Annual benefit: $70,000 Useful life: 7 years Land market value (EOY 3): $350,000 Equipment market value (EOY 3): $80,000 Depreciation: GDS7 Federal tax rate: 30% State tax rate: 4.28% The MARCS depreciation percentages (GDS7) for each year are:14.29; 24.49; 17.49; 12.49; 8.93; 8.92; 8.93; 4.46