Last year a local construction company had operating revenues of $1,240,000, operating costs of $520,000 and a CCA of $98,000 based upon existing assets. The beginning of last year the company bought essential new equipment for $130,000. This equipment has a CCA rate of 30%. The company has borrowed money and is paying $18,000 per year in interest. Interest paid on borrowed money is tax deductible, so it reduces the taxable income. Last years tax rate is 37.62%. When doing the taxation analysis for last year: