Question
You replace a 4-year old asset that cost $100,000 with a $200,000 asset. Both assets have a 5-year MACRS life. The tax rate is 30%
You replace a 4-year old asset that cost $100,000 with a $200,000 asset. Both assets have a 5-year MACRS life. The tax rate is 30% Calculate the change in CBCF due to the change in depreciation during the first year of the new asset's life.
| A. | $8,700 | |
| B. | $6,900 | |
| C. | $29,000 | |
| D. | $20,300 |
You replace a 3-year old asset that cost $100,000 with a $300,000 asset. Both assets have a 5-year MACRS life. The tax rate is 30% Calculate the change in CBCF due to the change in depreciation during the first year of the new asset's life.
| A. | $31,000 | |
| B. | $9,300 | |
| C. | $14,400 | |
| D. | $33,600 |
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Public Finance In Theory And Practice
Authors: Holley Ulbrich
2nd Edition
041558597X, 978-0415585972
