Your company is contemplating the acquisition of an engine repair facility located in Halifax for $Z. The facility will be kept in operation for six years (2012 to 2017). The available financial information about the facility for the current (2011) fiscal year is given below: In the current (2011) fiscal year: Revenue Material and labour costs Rent Loan payment (principal plus interest) The interest portion of the loan payment All other costs (utilities, etc.) Capital cost allowance (for the machinery and equipment) $6,600,000 $3,850,000 $ 620,000 $1,057,000 $ 275,810 $ 190,000 $ 327,870 MARR (the minimum attractive rate ofreturn) for your company is 15%. The income tax rate is 35%. The capital cost allowance rate for the machinery and equipment in the facility is 30%. Salvage values are zero. The after tax cash flow of the facility is expected to increase by 10% in each of the next six years.

(a) the un-depreciated capital cost (book value) of the machinery and equipment in the facility at the end of the current (2011) fiscal year

(b)the taxable income and the income tax payable in the current (2011) fiscal year

(c) the after tax cash flow in the current (2011) fiscal year (d) the maximum value of Z that can be economically justified