The after-tax analysis for a $60,000 investment with associated gross income minus expenses (GIOE) is shown below

The after-tax analysis for a $60,000 investment with associated gross income minus expenses (GI–OE) is shown below for the first 2 years only. If the effective tax rate is 40%, the values for depreciation (D), taxable income (TI), and taxes for year 1 are closest to:

(a) D = $5,000, TI = $25,000, taxes = $10,000
(b) D = $30,000, TI = $30,000, taxes = $4,000
(c) D= $20,000, TI = $50,000, taxes = $20,000
(d) D = $20,000, TI = $10,000, taxes =$4,000

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Investment, GI OE, Taxes, CFAT, Year 0-60,000 30,000 35.000 60,000 26,000 15,000 6000 29,000