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What is the annual value of the depreciation tax shield?

01 / 10 / 2021 Research Papers

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Finance 1 answer below » 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? Jan 17 2014 04:57 PM



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