Planas Corporation Has Provided the Following Information Concerning a Capital

question 123

Multiple Choice

Planas Corporation has provided the following information concerning a capital budgeting project: The company's income tax rate is 30% and its after-tax discount rate is 14%. The company uses straight-line depreciation on all equipment. Assume cash flows occur at the end of the year except for the initial investments. The company takes income taxes into account in its capital budgeting.
The income tax expense in year 3 is:

• A) $12,000
• B) $18,000
• C) $3,000
• D) $9,000

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Definitions:

Outside Order Taker

A sales role focused on receiving and processing orders from customers, typically not responsible for proactive selling or customer acquisition.

Inventory Clerk

A professional responsible for managing and maintaining a company's inventory, including receiving, recording, and distributing materials or products.

Taking Inventory

The process of counting and recording the quantity and condition of items or assets currently held by an organization or individual.

Inside Order Takers

Sales personnel who manage orders and assist customers from within the company, typically in an office setting, rather than in the field.