The Lumber Yard is considering adding a new product line that is expected to increase annual sales by $322,000 and expenses by $220,000. The project will require $129,000 in fixed assets that will be depreciated using the straight-line method to a zero book value over the 7-year life of the project. The company has a marginal tax rate of 34 percent. What is the depreciation tax shield?

Multiple Choice

• $34,680
• $15,640
• $6,266
• $12,467
• $14,190