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Alt 3: Invest $20,000, plus borrow an additional $20,000 at 8%, get income of $12,000 for 5 yrs, SL depreciation with 25,000 salvage value Try
Alt 3: Invest $20,000, plus borrow an additional $20,000 at 8%, get income of $12,000 for 5 yrs, SL depreciation with 25,000 salvage value Try to solve at home - show after-tax cash flows Hint: interest portion of loan payment as well as depreciation is deductable from taxable income 1. Calculate a depreciation schedule for an asset with a first cost of $150,000, a salvage value of $30,000, and 10-year life using: (a) Straight-line (b) 200% Declining Balance (c) Sum of Year's Digits
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