Pertinent information for two alternatives A and Bis shown below. If i=10% / year and the effectiveincome tax rate is 35%, answer the followingtrue/false questions.Basis, $Gross Income(GI), $OperatingExpense (OE), $Salvage Value, $MARCSRecovery, YearsTrueAlt. AO False150,000100,00030,00015,0005Alt.B225,,000100,00010,000The income tax amount at the end of year 3 of Alt.A is greater than $15,000.22,5005

Calculation of Net Income chargeable to Tax in Year 3 for Alt. A (GI) $ Gross Income…

Answered: Pertinent information for two…

Pertinent information for two alternatives A and B is shown below. If i=10% / year and the effective income tax rate is 35%, answer the following true/false questions.

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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Question

Pertinent information for two alternatives A and B
is shown below. If i=10% / year and the effective
income tax rate is 35%, answer the following
true/false questions.
Basis, $
Gross Income
(GI), $
Operating
Expense (OE), $
Salvage Value, $
MARCS
Recovery, Years
True
Alt. A
O False
150,000
100,000
30,000
15,000
5
Alt.B
225,,000
100,000
10,000
The income tax amount at the end of year 3 of Alt.
A is greater than $15,000.
22,500
5

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