One year, a company makes a $6,109 investment in a historic building. The investment is not depreciable, but it does qualify for a one-time 20% of investment amount as tax credit. In that same year, revenue is $46,651 and expenses (exclusive of the investment cost) are 40% of revenue. The company pays a total of 53% in income taxes. What is the after-tax present worth of this year's activities if the company's interest rate for investment is 10% (only 4 significant digits are required in the answer/zero decimal places, with no units).

One year, a company makes a $6,109 investment in a historic building. The investment is not depreciable, but it does qualify for a one-time 20% of investment amount as tax credit. In that same year, revenue is $46,651 and expenses (exclusive of the investment cost) are 40% of revenue. The company pays a total of 53% in income taxes. What is the after-tax present worth of this year's activities if the company's interest rate for investment is 10% (only 4 significant digits are required in the answer/zero decimal places, with no units).

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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