Ghost Company has a payback goal of three years on acquisitions of new equipment. A new piece
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Question:
Ghost Company has a payback goal of three years on acquisitions of new equipment. A new piece of equipment that costs $360,000 and that has a five-year life is being considered. Straight-line (SL) depreciation will be used, with zero salvage value. Ghost is subject to a 57% combined income tax rate, t. To meet the company's payback goal, the equipment must generate reductions in annual cash operating costs of at least:
Multiple Choice
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$120,000.
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$78,960.
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$219,960.
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$65,040.
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$183,628
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