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a company is launching a new product which costs $90000 and produces before tax operating cash flows (excluding CCA tax shield) of $26000 per year
- a company is launching a new product which costs $90000 and produces before tax operating cash flows (excluding CCA tax shield) of $26000 per year for 5 years. the project requires a net working capital of $4000 today and it will be recovered at the end of the 5th year. the CCA rate is 18% (declining balance method) and the half year rule applies. the discount rate is 10%, the tax rate is 35% and the expected salvage value is zero. What is the amount of the CCA tax shield in year 2?
- $2,835
- $4,433
- $6,735
- $5,160
- $14,742
- $2,835
- $4,433
- $6,735
- $5,160
- $14,742
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