Suppose That a Project Has a Depreciable Investment of $1,000,000

Multiple Choice

Suppose that a project has a depreciable investment of $1,000,000 and falls under the following MACRS year 5 class depreciation schedule:
Year 1: 20%; year 2: 32%; year 3: 19.2%; year 4: 11.5%; year 5: 11.5%; and year 6: 5.8%.
Calculate the depreciation tax shield for year 2 using a tax rate of 30%:

A) $224,000.
B) $60,000.
C) $96,000.
D) $300,000.