What is the value of the? microbrewery depreciation tax

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Reference no: EM132773464

Problem 1: You are considering adding a microbrewery onto one of your? firm's existing restaurants. This will entail an investment of $44,000 in new equipment. This equipment will be depreciated straight line over five years. If your? firm's marginal corporate tax rate is 40?%, then what is the value of the? microbrewery's depreciation tax shield in the first year of? operation?

A. $5,280
B. $26,400
C. $3,520
D. $17,600

Reference no: EM132773464

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