Business
Business, 19.11.2019 06:31, jiboyajordan2069

Ms. t. potts, the treasurer of ideal china, has a problem. the company has just ordered a new kiln for $560,000. of this sum, $70,000 is described by the supplier as an installation cost. ms. potts does not know whether the internal revenue service (irs) will permit the company to treat this cost as a tax-deductible current expense or as a capital investment. in the latter case, the company could depreciate the $70,000 straight-line over 5 years. the tax rate is 30% and the opportunity cost of capital is 5%.a. what is the present value of the cost of the kiln if the installation cost is treated as a separate current expense? b. what is the present value of the cost of the kiln if the installation cost is treated as a part of the capital investment? (round your answer to the nearest whole dollar amount.)

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Ms. t. potts, the treasurer of ideal china, has a problem. the company has just ordered a new kiln f...

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