A new machine will cost $500,000. It is in a CCA class pool that uses a declining balance rate of 30%. The company's tax rate is 40% and it requires a 15% rate of return on investments. Calculate the present value of the the tax shield the first year assuming the savings occur at year end.

options:

$26,086.96

$52,173.91

$78,214.34

$119,765.22

$126,998.42