Question
A facilities engineer is considering a $55,000 investment in an energy management system (EMS). The system is expected to save $14,000 annually in utility bills
A facilities engineer is considering a $55,000 investment in an energy management system (EMS). The system is expected to save $14,000 annually in utility bills for N years. After N years, the EMS will have a zero salvage value. In an after-tax analysis, what would N need to be in order for the investment to earn a 12% return? Assume MACRS depreciation with a three-year class life and a 35% tax rate.
| a. | 5 years | |
| b. | 6 years | |
| c. | 7 years | |
| d. | 8 years |
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Auditing And Assurance Theory And Practice
Authors: Clifford Gomez
1st Edition
8120345665, 978-8120345669
