The companys required rate of return is 13 percent what is, Accounting Basics

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The companys required rate of return is 13 percent what is

Problem

Strauss Corporation is making a $85, 450 investment in equipment with a 5-year life. The company uses the straight-line method of depreciation and has a tax rate of 40 percent. The company's required rate of return is 13 percent. What is the present value of the tax savings related to depreciation of the equipment?

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Accounting Basics: The companys required rate of return is 13 percent what is

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