Question Details

Accounting Homework Help

Your Company is considering a new project that will require$900,000 of new equipment at the start of the project. Theequipment will have a depreciable life of 10 years and will bedepreciated to a book value of $225,000 using straight-linedepreciation. The cost of capital is 10%, and the firm's tax rateis 34%. Estimate the present value of the tax benefits fromdepreciation (closest to).