Hy point to straight-line. Now what is the present value of the depreciation tax shields? (Enter your ans millions rounded to 1 decimal place.) Double decline Schedule Year 1 Year 2 Year Year 4 Year 5 Year 6 Year 7 Year 8 Year 9 art of Year Book Value 24 11.4 2$ 9.1 24 7.3 $ 4.7 $ 5.8 24 3.7 $ 3.0 %24 2.2 $ 1. preciation 2$ 2.3 2$ 1.8 24 1.5 24 1.2 $ 0.7 $ 0.9 %24 0.7 %24 0.7 %24 < Shields at 35% Tc $ 0.8 2$ 0.5 0.6 24 2$ 0.4 $ 0.3 %24 0.3 $ 0.3 S 0.3 2$ (Tax Shields) at 10% 2$ 0.7 $ 0.5 2$ 0.4 $ 0.3 24 0.2 $ 0.1 $ 0.1 $ 0.1 "hat would be the present value of the tax shield if the government allowed Sudbury to write-off the factory ediately? (Enter your answer in millions rounded to 1 decimal place.) cent value of depreciation tax shields
Hy point to straight-line. Now what is the present value of the depreciation tax shields? (Enter your ans millions rounded to 1 decimal place.) Double decline Schedule Year 1 Year 2 Year Year 4 Year 5 Year 6 Year 7 Year 8 Year 9 art of Year Book Value 24 11.4 2$ 9.1 24 7.3 $ 4.7 $ 5.8 24 3.7 $ 3.0 %24 2.2 $ 1. preciation 2$ 2.3 2$ 1.8 24 1.5 24 1.2 $ 0.7 $ 0.9 %24 0.7 %24 0.7 %24 < Shields at 35% Tc $ 0.8 2$ 0.5 0.6 24 2$ 0.4 $ 0.3 %24 0.3 $ 0.3 S 0.3 2$ (Tax Shields) at 10% 2$ 0.7 $ 0.5 2$ 0.4 $ 0.3 24 0.2 $ 0.1 $ 0.1 $ 0.1 "hat would be the present value of the tax shield if the government allowed Sudbury to write-off the factory ediately? (Enter your answer in millions rounded to 1 decimal place.) cent value of depreciation tax shields
Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
Problem 1PS
Related questions
Question
Transcribed Image Text:Saved
Help
Save & Exit
Submit
Check my work
switch at any point to straight-line. Now what is the present value of the depreciation tax shields? (Enter your answers
in millions rounded to 1 decimal place.)
Double decline Schedule
Year 1
Year 2
Year
Year 4
Year 5
Year 6
Year 7
Year 8
Year 9
Year
Start of Year Book Value
11.4 $
9.1 $
%24
7.3 $
5.8
4.7 $
3.7
3.0
2.2 $
1.5 $
Depreciation
2.3
1.8 $
1.5 $
1.2 $
0.9 $
0.7
0.7
0.7 $
0.7 $
Tax Shields at 35% Tc
$0.8
0.6 $
0.5
0.4
0.3 $
0.3 $
%24
0.3 $
%24
0.3
0.3 $
PV (Tax Shields) at 10%
$ 0.7
0.5
0.4
0.3 $
0.2
0.1 $
0.1 $
0.1
0.1 $
c. What would be the present value of the tax shield if the government allowed Sudbury to write-off the factory
immediately? (Enter your answer in millions rounded to 1 decimal place.)
Percent value of depreciation tax shields
Next
%24
%24
%24
%24
%24
%24
%24
%24
%24
%24
%24
%24
%24
%24
%24
%24
%24
Expert Solution
This question has been solved!
Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.
Step by step
Solved in 2 steps
Recommended textbooks for you
Essentials Of Investments
Finance
ISBN:
9781260013924
Author:
Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:
Mcgraw-hill Education,
Essentials Of Investments
Finance
ISBN:
9781260013924
Author:
Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:
Mcgraw-hill Education,
Foundations Of Finance
Finance
ISBN:
9780134897264
Author:
KEOWN, Arthur J., Martin, John D., PETTY, J. William
Publisher:
Pearson,
Fundamentals of Financial Management (MindTap Cou…
Finance
ISBN:
9781337395250
Author:
Eugene F. Brigham, Joel F. Houston
Publisher:
Cengage Learning
Corporate Finance (The Mcgraw-hill/Irwin Series i…
Finance
ISBN:
9780077861759
Author:
Stephen A. Ross Franco Modigliani Professor of Financial Economics Professor, Randolph W Westerfield Robert R. Dockson Deans Chair in Bus. Admin., Jeffrey Jaffe, Bradford D Jordan Professor
Publisher:
McGraw-Hill Education