tax

Problem 4) Wilson Security has received a contract to provide additional security for corporate and government personnel along the Arizona-Mexico border. Wilson plans to purchase listening and detection equipment for use in the 6-year contract. The equipment is expected to cost $550,000 and have a resale value of $150,000 after 6 years. Based on the incentive clause in the contract, Wilson estimates that the equipment will increase contract revenue by $200,000 per year and require an additional M&O expense of $90,000 per year. SOYD depreciation allows recovery in and the effective corporate tax rate is 35% per year. Tabulate and plot the years, 5 CFBT and CFAT series. ( ) Wilson . Wilson . ( . Wilson (M&O . (SOYD) . (CFBT) (CFAT) . . TX TI CFAT -550,000 DsOYD CFBT Year -550,000 0 1 2 3 4 5 0 6 150,000 150,000 6