The initial investment will require 96000 in fixed assets


The Lumber Yard is considering adding a new product line that is expected to increase annual sales by $238,000 and cash expenses by $184,000. The initial investment will require $96,000 in fixed assets that will be depreciated using the straight-line method to a zero book value over the 6-year life of the project. The company has a marginal tax rate of 32 percent. What is the annual value of the depreciation tax shield?

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Finance Basics: The initial investment will require 96000 in fixed assets
Reference No:- TGS0622489

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