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epreciation Tax Shields Mendota Company has purchased equipment for $ 3 5 0 , 0 0 0 . After it is fully depreciated, the equipment

epreciation Tax Shields
Mendota Company has purchased equipment for $350,000. After it is fully depreciated, the equipment will have no salvage value. Mendota may select either of the following depreciation schedules for tax purposes:Depreciation123456Assuming a 40% tax rate and a 12% desired annual return, compute the total present value of the tax savings provided by these alternative depreciation tax shields.
Round answers to the nearest whole number. Use rounded answers to calculate total.Option 1 depreciation:123456Option 2 depreciation:123456Which depreciation schedule would be more attractive to Mendota?AnswerOption 1Option 2

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