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Finance

Problem:

Outdoor Gear is purchasing equipment costing $1.2 million that will lower manufacturing costs by $280,000 a year. The equipment will be depreciated over 7 years using straight-line depreciation to a book value of zero. After 7 years, the equipment will be worthless. The discount rate is 14 percent and the tax rate is 35 percent.

Required:

Question: What is the annual net income?

$111,428.57
$70,571.43
$59,600.00
$38,000.00
$43,600.00

Note: Show all workings.

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Basic Finance, Finance

Category:- Basic Finance
Reference No.:- M91175185

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