Louie's Leisure Products Is Considering a Project Which Will Require

Louie's Leisure Products is considering a project which will require the purchase of $1.4 million in new equipment. The equipment belongs in a 20% CCA class. Louie's expects to sell the equipment
At the end of the project for 20% of its original cost. Annual sales from this project are estimated at
$1) 2 million. Net working capital equal to 20% of sales will be required to support the project. All of
The net working capital will be recouped at the end of the project. The firm desires a minimal 14%
Rate of return on this project. The tax rate is 34%.
What is the present value of the CCA tax shield for this project?

A) $34,299
B) $68,047
C) $132,493
D) $200,782
E) $240,427