Calculate the OCF and CCA Tax Shield Given the Following

question 174

Multiple Choice

Calculate the OCF and CCA tax shield given the following information: Sales $490,000; Costs $250,000; Depreciation $85,000. Tax rate is 30%.

• A) OCF = $195,500; CCA tax shield = $28,000
• B) OCF = $193,500; CCA tax shield = $28,900
• C) OCF = $191,500; CCA tax shield = $29,800
• D) OCF = $190,500; CCA tax shield = $30,700
• E) OCF = $189,500; CCA tax shield = $31,600

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