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Charlene is evaluating a capital budgeting project that should last for 4 years. The project requires 5100,000 of equipment and is eligibie for 100 bonus

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Charlene is evaluating a capital budgeting project that should last for 4 years. The project requires 5100,000 of equipment and is eligibie for 100 bonus depreclation. She is unsure whether immediately expensing the equipment or using straight-line deprediation is better for the arsilysis. Under strigitt-line depreciation, the cost of the equipment would be depredated evenly over its 4-year life (lignore the half-year convention for the straight-line methos). The company's WACC is 11%, and its tax rate is 20%. a. What would the depre 7 expense be each year under each method? Enter your answers as positive values, pound your anawers to the nearest dollar. Which depreciation method would produce the higher NPV? How much higher woulu the NPV be under the preferred method? Do not round intermediate calculations. Round yaur answer to the nearest doliar. 5

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