Question
CBA Elevator costs $50,000 with an expected life of 5 years. The elevator will be depreciated on a straight-line basis to an expected salvage value
CBA Elevator costs $50,000 with an expected life of 5 years. The elevator will be depreciated on a straight-line basis to an expected salvage value of zero.
The annual operating costs are $8,000. Applicable tax rate is 30% and required rate of return is 10.0%.
What is the equivalent annual cost?
A. $9,856
B. $28,890
C. $2,600
D. $109,856
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Financial Accounting The Impact On Decision Makers
Authors: Gary A Porter, Curtis L Norton
7th Edition
1439080526, 9781439080528
