Your Firm Needs a Computerized Line-Boring Machine Which Costs $80,000

question 56

Multiple Choice

Your firm needs a computerized line-boring machine which costs $80,000, and requires $20,000 in maintenance for each year of its three year life. After three years, the salvage value will be zero. The machine falls into the Class 10 equipment category (CCA rate 30%) .

Assume a tax rate of 34% and a discount rate of 10%. Assume the machine can be sold for $10,000 at the end of year 1. Compute the present value of the pre-tax salvage value at the end of year 3.

• A) $10,000
• B) $7,513
• C) $6,600
• D) $8,616
• E) $9,678

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Definitions:

Encoding

The initial stage of memory processing, where information is converted into a format that can be stored in the brain.

Elaboration

The addition of more detail or information to something, often to clarify or enhance understanding.

Visual Imagery

The process of forming mental pictures or images in one's mind, which can enhance memory, creativity, and understanding of concepts.

Baddeley's Model

A model of working memory proposed by Alan Baddeley, which consists of three main components: the central executive, the phonological loop, and the visuospatial sketchpad.