Income Taxes and After-Tax Analysis — Engineering Board Exam Practice Questions

4 free engineering board exam reviewer questions on Income Taxes and After-Tax Analysis (Engineering Economics), each with the correct answer and a worked solution.

1. An asset costing P600,000 is depreciated over 5 years with the sum-of-years-digit method (no salvage value). At a 30% tax rate and 10%…
2. A project has a before-tax cash flow of P500,000 and depreciation of P200,000. At a 35% tax rate, find the after-tax cash flow.
3. A bond pays 12% interest and the investor pays a 30% tax on the interest. Find the after-tax rate of return.
4. A firm has revenue of P2,000,000, operating expenses of P900,000, and depreciation of P300,000. At a 30% tax rate, find the income tax.