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pls help Firm W, which has a 30 percent marginal tax rate, plans to operate a new business that should generate $58,000 annual cash flow
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Firm W, which has a 30 percent marginal tax rate, plans to operate a new business that should generate $58,000 annual cash flow and ordinary income for three years (years 0,1 , and 2). Alternatively, Firm W could form a new taxable entity (Entity N ) to operate the business. Entity N would pay tax on the three-year income stream at a 20 percent rate. The nondeductible cost of forming Entity N would be $6,800. Firm W uses a 5 percent discount rate. Use Appendix A and Appendix B. Required: a. Complete the below tables to calculate NPV. b. Should it operate the new business directly or form Entity N to operate the business? Complete this question by entering your answers in the tabs below. Complete this question by entering your answers in the tabs below. Complete the below tables to calculate NPV. Note: Cash outflows should be indicated by a minus sign. Round discount factors to 3 decimal places. Round intermediate calculations and final answers to the nearest whole dollar amountStep by Step Solution
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