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Fool Proof Software is considering a new project whose data are shown below. The equipment that would be used has a 3-year tax life, and
Fool Proof Software is considering a new project whose data are shown below. The equipment that would be used has a 3-year tax life, and the allowed depreciation rates for such property are 33.0\% 45.0% 15.0\% , and % for Years 1 through 4. Under the new tax law, the equipment used in the project is eligible for 100% bonus depreciation, so it will be fully depreciated at Revenues and other operating costs are expected to be constant over the project's -year expected lifeWhat is the Year 1 cash flow? Equipment cost Sales revenues, each year $ 55,000 79,800 Operating costs $20,900 Tax rate 25.0
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