Teal Mountain Inc. owns 25% of the common shares of Monty Corp. The other 75% of the shares are owned by the Monty family. Teal Mountain acquired the shares eight years ago through a financing transaction. Each year, Teal Mountain has received a dividend from Monty. Monty has been in business for 60 years and continues to have strong operations and cash flows. Teal Mountain must determine the fair value of this investment at its year end. Since there is no market on which the shares are traded, Teal Mountain must use a discounted cash flow model to determine fair value. Teal Mountain management intends to hold the shares for 5 more years, at which time they will sell the shares to the Monty family under an existing agreement for $1 million. There is no uncertainty in this amount. Management expects to receive dividends of $88,000 for each of the five years, although there is a 20% chance that dividends could be $44,000 each year. The risk-free rate is 6% and the risk-adjusted rate is 8%.

Partnerships are the most common type of business firms in the world. t/f

Acrosswalk_when there are no pavement markings.

Lo.2, 3, 9 lori, who is single, purchased 5-years class property for $200,00 and 7-years class property for $420,000 on may 20, 2018. lori experts the taxable income derived form the business (without regard to the amount expensed under ⧠179) to be about $550,000. lori has determined that she should elect immediate ⧠179 expensing in the amount of $520,000, but she doesn’t know which asset she should completely expense under ⧠179. she does not claim any available additional first-year depreciation. a. determine lori’s total cost recovery deduction if the ⧠179 expense is first taken with respect to the 5-year class asset. b. determine lori’s total cost recovery deduction if the ⧠179 expense is first taken with respect to the 7-year class asset. c. what is your advice for lori? d. assume that lori is in the 24% marginal tax bracket and that she uses ⧠179 on the 7-year asset. determine the present value of the tax savings from the depreciation deductions for both assets. see appendix g for present value factors, and assume a 6% discount rate. e. assume the same facts as in part (d), except that lori decides not to use ⧠179 on either asset. determine the present value of the tax savings under this choice. in addition, determine which option lori should choose. f. present your solution to parts (d) and (e) of the problem in a spreadsheet using appropriate microsoft excel formulas. e-mail your spreadsheet to your instructor with a two-paragraph summary of your findings.