Question
A restaurant invests $240,000 in a new food truck for mobile lunch sales. The truck will have a capital cost allowance (CCA) rate of 20%.
A restaurant invests $240,000 in a new food truck for mobile lunch sales. The truck will have a capital cost allowance (CCA) rate of 20%. If the opportunity cost of capital is 8.5%, and the restaurant's marginal tax rate is 30%, what is the present value of the CCA tax shield?
Question 7 options:A)$48,547
B)$48,000
C)$35,938
D)$14,400
E)$50,526
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Contemporary Business Mathematics with Canadian Applications
Authors: S. A. Hummelbrunner, Kelly Halliday, Ali R. Hassanlou, K. Suzanne Coombs
11th edition
134141083, 978-0134141084
