Newton Company Is Considering the Purchase of an Asset That

Multiple Choice

Newton Company is considering the purchase of an asset that will provide a depreciation tax shield of $10,000 per year for 10 years.Assuming the company is subject to a 40% tax rate during the period and a zero salvage value,what is the depreciable cost of the new asset?

A) $100,000
B) $250,000
C) $400,000
D) Can't be determined from the information provided