FIN504.R.GitmanCh01.02_Student - Monsanto Corporation...

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Monsanto Corporation Purchase of New Equipment Cost-Benefit Analysis Benefits with the new equipmen ### Less: Benefits with the old equ ### Marginal (added) benefits of the ### Cost of new equipment ### Less: Proceeds from the sale o ### Marginal (added) costs of the N ### Net benefit of the proposed purchas ###
Current Income Expansion Income Expansion Income With No Expansion Using Cash Reserves Using Debt Financing Before tax income $200,000 $350,000 $350,000 Corporate Tax Rate Schedule Interest expense $0 $0 $70,000 Taxable income $200,000 $350,000 $280,000 Range of taxable income

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