A Company Buys 10 New Computers Every Year for $1

Multiple Choice

A company buys 10 new computers every year for $1 200 each. They depreciate at 30% per year. After two years they are sold for their UCC value. The half-year rule applies. If the company pays taxes at 40% and has an after-tax MARR of 20%, what is the net present cost of buying and subsequently selling each computer?

A) $289
B) $393
C) $412
D) $478
E) $521