David's company is considering the acquisition of machine which belongs to a class with CCA rate of 50%. The cost of the machine is $1,365,000. The expected economic life is 8 years. Salvage value is $132,000. The discount rate is 7.70% and the marginal tax rate is 35%. Assume the half-year rule applies. What is the CCA tax shield for year 2?

a.

$341,250

b.

$511,875

c.

$358,313

d.

$119,438

e.

$179,156