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2. A firm sells an asset for $105,000 at the end of a project. The tax rate is 35%. Compute the after-tax salvage value in
2. A firm sells an asset for $105,000 at the end of a project. The tax rate is 35%. Compute the after-tax salvage value in each case if the book value of the asset is $105,000, $50,000, or $150,000. Capital Investment In-Class Exercise After-tax Salvage Value Tax Rate: 35.00% $ $ 11 105,000 $ 105,000 $ 21 105,000 $ 50,000 $ 3 105,000 150,000 Before-tax Salvage Value Book Value Gain/(Loss) Tax on Gain/(Loss) After-tax Salvage Value
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