Question
You purchase equipment valued at $1,365,000 for a five-year project. Your firm uses straight-line depreciation for five years. Your marginal tax rate is 35%. What
You purchase equipment valued at $1,365,000 for a five-year project. Your firm uses straight-line depreciation for five years. Your marginal tax rate is 35%.
What is your annual depreciation?
What is the tax shield generated from this investment each year?
Annual depreciation x marginal tax rate= tax shield generated
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Personal Finance Version 3.1
Authors: Rachel S. Siegel
3rd Edition
1453334807, 978-1453334805
