Downtown Candies is considering replacing the equipment it uses to make chocolate candy bars. The equipment would cost $721,000 and lower manufacturing costs by an estimated $170,000 a year. The equipment belongs in a 30% CCA class. The required rate of return is 14% and the tax rate is 35%. What is the increase in net income for the second year from this proposed project?

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The Answer of Downtown Candies is considering replacing the equipment it uses to make chocolate candy bars. The equipment would cost $721,000 and lower manufacturing costs by an estimated $170,000 a year. The equipment belongs in a 30% CCA class. The required rate of return is 14% and the tax rate is 35%. What is the increase in net income for the second year from this proposed project?

Downtown Candies Is Considering Replacing the Equipment It Uses to Make