Layout of new research and experimentation facility

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Reference no: EM131909784

An engineer is working on the layout of a new research and experimentation facility. Two plant operators will be required. If, however, an. Additional $100,000 of instrumentation and remote controls were added, the plant could be run by a single operator. The total before-tax cost of each plant operator is projected to be S35,000 per year. The instrumentation and controls will be depreciated by means of the modified accelerated cost recovery system (MACRS). If this corporation (34% corporate tax rate) invests in the additional instrumentation and controls, how long will it take for the after-tax benefits to equal the $100,000 cost? In other words, what is the after-tax payback period?

Reference no: EM131909784

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