1. A firm is considering purchasing a new asset. Use the information in the chart below to find the net cash outlay for this asset. 0 125,000 0 Cost of New Asset Installation Costs Old Asset Book Value Proceeds on Sale Initial Purchase Price Decrease in Working Capital 0 32,000 100,000 7.000 0.15 Capital gains tax rate Income tax rate 0.30 PROBLEM 1 Inputs Cost of New Asset Installation Costs Old Asset Book Value Proceeds on Sale Initial Purchase Price Decrease in Working Capital Distribution Tax Effects Outputs Book Value Capital Gain Capital Loss Recaptured Depreciation Proceeds on Sale Cost of New Asset Installation Costs Proceeds on Sale, Old Asset Taxes on Proceeds on Sale Decrease in Working Capital Net Cash Outlay