Massive Amusements, an owner of theme parks, invests $65 million to build a roller coaster. This can be depreciated using the MACRS schedule shown above. How much less is the depreciation tax shield for year 4 under MACRS depreciation than under 7-year, straight-line depreciation, if the tax rate is 35%?
A) $974,680
B) $1,218,350
C) $2,193,030
D) $6,091,750

Question

Massive Amusements, an owner of theme parks, invests $65 million to build a roller coaster. This can be depreciated using the MACRS schedule shown above. How much less is the depreciation tax shield for year 4 under MACRS depreciation than under 7-year, straight-line depreciation, if the tax rate is 35%?
A) $974,680 
B) $1,218,350 
C) $2,193,030 
D) $6,091,750

Quizplus · Accepted Answer

B) 11ea84dc_f54a_73c9_9a63_559053f6c308_TB1316_00_TB1316_00 11ea84dc_f54a_73ca_9a63_b934ea075a65_TB1316_00_TB1316_00 11ea84dc_f54a_73cb_9a63_a3c751a0ca37_TB1316_00_TB1316_00 11ea84dc_f54a_73cc_9a63_0f411264d844_TB1316_00_TB1316_00

Massive Amusements, an Owner of Theme Parks, Invests $65 Million