Gomi waste disposal is evaluating project

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Reference no: EM132018876

Gomi Waste Disposal is evaluating a project that would require the purchase of a piece of equipment for 135,000 dollars today. During year 1, the project is expected to have relevant revenue of 120,000 dollars, relevant costs of 47,000 dollars, and relevant depreciation of 23,000 dollars. Gomi Waste Disposal would need to borrow 135,000 dollars today to pay for the equipment and would need to make an interest payment of 9,000 dollars to the bank in 1 year. Relevant net income for the project in year 1 is expected to be 43,910 dollars. What is the tax rate expected to be in year 1? Answer as a rate in decimal format so that 12.34% would be entered as .1234 and 0.98% would be entered as .0098.

Reference no: EM132018876

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