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lyudmila [28]
3 years ago
7

The salvage value on a piece of equipment for Excavators, Inc. is expected to be $10,000 in 12 years. If the discount rate is 8%

, what is the present value of the equipment's salvage value? A : $3,220 B : $4,039 C : $3,971 D : $3,168
Business
1 answer:
DanielleElmas [232]3 years ago
4 0

Answer:

correct option is  C : $3,971

Explanation:

given data

salvage value = $10,000

time = 12 year

rate = 8 %

to find out

what is the present value of the equipment's salvage value

solution

we get here present value of the equipment salvage value that is express as

present value of the equipment = $10000 × Present value of discounting factor

put here value we get

= \frac{salvage\ value}{(1+rate)^t}

= \frac{10000}{(1+0.08)^{12}}

= 3971

so correct option is  C : $3,971

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The pass-through deduction or the section 199A deduction as it is officially called is a reduction by 20 percent of your income tax provided by the new tax law set in place for the 2018 tax year. It is eligible for small business owners who run a pass-through business and whose tax income doesn't exceed $157,500 for singles and $315,000 for married couples.

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