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A firm is considering the following investment project: Before-Tax Cash Flow Year 0 1 2 3 4 (thousands) -$1,000 $500 $340 $244 $100 $100
A firm is considering the following investment project: Before-Tax Cash Flow Year 0 1 2 3 4 (thousands) -$1,000 $500 $340 $244 $100 $100 LO 5 $125 (salvage value) The project has a 5-year useful life with a $125,000 salvage value (as shown). Double declining balance depreciation will be used. The combined income tax rate is 24%. What is the depreciation charge in the first year?
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Investment Analysis and Portfolio Management
Authors: Frank K. Reilly, Keith C. Brown
10th Edition
538482109, 1133711774, 538482389, 9780538482103, 9781133711773, 978-0538482387
