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10 bents Hercules Exercise Equipment Co. purchased a computerized measuring device two years ago for $80,000. The equipment falls into the five-year category for
10 bents Hercules Exercise Equipment Co. purchased a computerized measuring device two years ago for $80,000. The equipment falls into the five-year category for MACRS depreciation and can currently be sold for $35,800 A new piece of equipment will cost $240,000. It also falls into the five-year category for MACRS depreciation Assume the new equipment would provide the following stream of added cost savings for the next six years. Use Table 12-12 Use Appendix B for an approximate answer but calculate your final answer using the formula and financial calculator methods. Cash Year eBook Savings 1 $62,000 Hin 2 52,000 3 50,000 Print 4 48,000 5 45,000 References 6 34,000 The firm's tax rate is 25 percent and the cost of capital is 9 percent e. What is the book value of the old equipment? (Do not round intermediate calculations and round your answer to the nearest whole dollar.) Book value
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