Siddon Inc is considering investing in equipment that costs $24,000. The equipment would be depreciated using the straight-line method with no half-year convention over five years and have no salvage value. If the company has a 35 percent income tax rate and desires an after-tax rate of return of 11 percent on investments, the total present value of the depreciation tax shield is:
A) $8,652.
B) $8,400.
C) $6,209.
D) $997.
C
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