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Ford Motor Company is considering launching a new line of hybrid diesel-electric SUVs. The heavy advertising expenses associated with the new SUV launch would generate
Ford Motor Company is considering launching a new line of hybrid diesel-electric SUVs. The heavy advertising expenses associated with the new SUV launch would generate operating losses of
$40
million next year. Without the new SUV, Ford expects to earn pretax income of
$70
million from operations next year. Ford pays a
35%
tax rate on its pretax income. The amount that Ford Motor Company owes in taxes next year with the launch of the new SUV is closest to:
A.
$24.5
million
B.
$14.0
million
C.
$10.5
million
D.
$38.5
million
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