Question

Suppose a​ firm's tax rate is 35%. a. What effect would a $10.35 million operating expense...

Suppose a​ firm's tax rate is

35%.

a. What effect would a

$10.35

million operating expense have on this​ year's earnings? What effect would it have on next​ year's earnings?

b. What effect would

a

$10.20

million capital expense have on this​ year's earnings if the capital is depreciated at a rate of  

$2.04

million per year for five​ years? What effect would it have on next​ year's earnings?

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