A small company pays 30% in income taxes. A $2000 machine with a four-year life and zero salvage value will generate revenues of $1200 annually. Using 8%, compare the present worth of the after-tax profits using single line and sum-of-the-years digits depreciation.
A small company pays 30% in income taxes. A $2000 machine with a four-year life and zero salvage value will generate revenues of $1200 annually. Using 8%, compare the present worth of the after-tax profits using single line and sum-of-the-years digits depreciation.
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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A small company pays 30% in income taxes. A $2000 machine with a four-year life and zero salvage value will generate revenues of $1200 annually. Using 8%, compare the present worth of the after-tax profits using single line and sum-of-the-years digits
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