14) Consider an equipment purchase of $140,000 today (n=0) that will be put into operation in its 3rd year (n=3). The equipment is expected to be operational for 10 years. In just under 6 years from today (n=6), the equipment will require an overhaul costing $40,000. Using the CCA method (50% rule applies to both equipment and overhaul) and assuming a CCAequipment rate of 30% and CCAoverhaul rate of 20 %, what is CCA9 (the CCA for period n=9)? (Rounded up/down to the nearest dollar figure) a) 9,808 b) 10,008 c) 10,208 d) 10,408 e) 10,608 Yr. 3 Eya 9 36,75)(.7)(14on) + '(4ou) Bz
14) Consider an equipment purchase of $140,000 today (n=0) that will be put into operation in its 3rd year (n=3). The equipment is expected to be operational for 10 years. In just under 6 years from today (n=6), the equipment will require an overhaul costing $40,000. Using the CCA method (50% rule applies to both equipment and overhaul) and assuming a CCAequipment rate of 30% and CCAoverhaul rate of 20 %, what is CCA9 (the CCA for period n=9)? (Rounded up/down to the nearest dollar figure) a) 9,808 b) 10,008 c) 10,208 d) 10,408 e) 10,608 Yr. 3 Eya 9 36,75)(.7)(14on) + '(4ou) Bz
Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
Problem 1PS
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Transcribed Image Text:14) Consider an equipment purchase of $140,000 today (n=0) that will be put into
operation in its 3rd year (n=3). The equipment is expected to be operational for 10
years. In just under 6 years from today (n=6), the equipment will require an
overhaul costing $40,000.
Using the CCA method (50% rule applies to both equipment and overhaul) and
assuming a CCAequipment rate of 30% and CCAoverhaul rate of 20%, what is CCA9
(the CCA for period n=9)?
(Rounded up/down to the nearest dollar figure)
a) 9,808
b) 10,008
c) 10,208
d) 10,408
e) 10,608
Yr. 3
yr. 4,5,6,7,2
E yn
36,75)(.7)(140n)
t
(4ou)
= 10,608
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