Question
For a 5-year capital budgeting project, two large pieces of equipment must be purchased. The first piece will be purchased at Time 0. It will
For a 5-year capital budgeting project, two large pieces of equipment must be purchased. The first piece will be purchased at Time 0. It will cost $120,000 and be depreciated straight-line for four years. The second piece of equipment isnt required right away, so it wont be purchased until Time 2. This piece will cost $450,000 and will be depreciated straight-line for three years. Assume that depreciation starts the year following purchase for both pieces of equipment. Find the total depreciation expense for each year of the project. Show your work.
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