Surfers Supply Ltd has just purchased a new computerised information system with an installed cost of $120000.

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Surfers Supply Ltd has just purchased a new computerised information system with an installed cost of $120 000. The computer is treated as a four-year asset. What are the yearly depreciation allowances? Based on historical experience, we think that the system will be worth only $5 000 when we get rid of it in four years. What are the tax consequences of the sale? What is the total after-tax cash flow from the sale?

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Fundamentals Of Corporate Finance

ISBN: 9781743768051

8th Edition

Authors: Stephen A. Ross, Rowan Trayler, Charles Koh, Gerhard Hambusch, Kristoffer Glover, Randolph W. Westerfield, Bradford D. Jordan

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