I am unsure what the answer is
for this question.
Homework Answers
Annual depreciation=(Cost-Salvage value)/Useful Life
=(540,000-100,000)/10
=$44,000
Hence annual tax benefits=Annual depreciation*Tax rate
=44000*21%
=$9240
Present value of annuity=Annuity[1-(1+interest rate)^-time period]/rate
=9240[1-(1.13)^-10]/0.13
=9240*5.42624348
=$50138(Approx).
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