The Wet Corp

question 83

Multiple Choice

The Wet Corp. has an investment project that will reduce expenses by $25,000 per year for 3 years. The project's cost is $55,000. If the asset is part of the 3-year MACRS category (33% first year depreciation) and the company's tax rate is 34%, what is the cash flow from the project in year 1?

• A) $16,800
• B) $15,100
• C) $22,671
• D) $16,667

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Definitions:

Pigeon

A bird of the family Columbidae, known for its ability to find its way home over long distances.

Associative Learning

The process by which an association between two stimuli or a behavior and a stimulus is learned.

Operant Conditioning

A teaching mechanism in which behavior is changed by applying incentives or consequences.

Classical Conditioning

Gaining understanding through the relationship between an environmental cue and an inherently present stimulus.