(Appendix 8C)Pont Corporation Has Provided the Following Information Concerning a Capital

question 135

Multiple Choice

(Appendix 8C) Pont 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 10%.The working capital would be required immediately and would be released for use elsewhere at the end of the project.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 total cash flow net of income taxes in year 3 is:

• A)$103, 000
• B)$33, 000
• C)$54, 000
• D)$60, 000

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Definitions:

Canada

A country in North America known for its vast landscapes, multicultural communities, and as a member of the Commonwealth.

Neuropsychology

The study of the relationship between brain function, behavior, and psychological processes.

Brenda Milner

A pioneering neuropsychologist whose research helped understand the role of the temporal lobes in memory function.

Founders

Individuals who establish an organization, institution, or country, often contributing significantly to its initial development.