Multiple Choice
LaMont and Sons is considering the purchase of some wood lathes for $229,001. These lathes belong in a 30% CCA class. The firm expects that it will be able to sell the machines for $49,500 in four years' time. What is the present value of the CCA tax shield on this equipment if the tax rate is 34% and the relevant discount rate is 12%?
A) $31,458
B) $39,371
C) $41,203
D) $44,995
E) $58,316
Correct Answer:
Verified
Correct Answer:
Verified
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