AOS Industries had contemplated buying a new warehouse for $2 million, the cost of which would be depreciated over 10 years. If AOS Industries has a tax rate of 25%, what would be the impact for the amount of cash held by AOS at the end of the 2008?
a. It would have $2,000,000 less cash at the end of 2008.
b. It would have $1,950,000 less cash at the end of 2008.
c. it would have $150,000 less cash at the end of 2008.???
d. it would have an additional $50,000 in cash at the end of 2008.

Question

AOS Industries had contemplated buying a new warehouse for $2 million, the cost of which would be depreciated over 10 years. If AOS Industries has a tax rate of 25%, what would be the impact for the amount of cash held by AOS at the end of the 2008?
        a. It would have $2,000,000 less cash at the end of 2008.
        b. It would have $1,950,000 less cash at the end of 2008.
        c. it would have $150,000 less cash at the end of 2008.???
        d. it would have an additional $50,000 in cash at the end of 2008.