Your company is considering a new project that will require $1,000,000 of new equipment at the start of the project. The equipment will have a depreciable life of 10 years and will be depreciated to a book value of $150,000 using straight-line depreciation. The cost of capital is 13 percent, and the firm's tax rate is 34 percent. Estimate the present value of the tax benefits from depreciation.
I am required to do this problem in Excel, and I have no idea where to start. Please help!

To give a better idea of where you might be stuck, post back in with your thoughts on these...



How much total depreciation will the company take on this asset?
Using the straight-line method, how much depreciation will the company take each year over the asset's life?
At the given tax rate, what will be the annual tax benefit of the annual depreciation expense?

That'll kick things off.