Calculate the impact on federal income tax of installing


For a company now with taxable income of $180,000, calculate the impact on federal income tax of installing new equipment that requires $260,000 to install, produces no new income before depreciation in the first year, and classifies as 7 year property for depreciation.

a. What is the income tax ($) before the new equipment is installed?

b. What is the income tax ($) after the new equipment is installed?

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Financial Management: Calculate the impact on federal income tax of installing
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