Baton Rouge Company is considering purchasing new equipment which will cost $950,000. This equipment is expected to have a useful life of 15 years, have a salvage value of $50,000 and is expected to have an annual net cash inflow (before taxes) of $80,000. Assume the company is in the 34% tax bracket.
What is Baton Rouge's annual net cash inflow (after taxes)?
Question 12 options:
$13,200
$52,800
$73,200
$112,800