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6. Pecos Company is considering the purchase of new equipment that will cost $225,000. The equipment will save the company $82,000 per year in before-tax
6. Pecos Company is considering the purchase of new equipment that will cost $225,000. The equipment will save the company $82,000 per year in before-tax cash operating costs. The equipment has an estimated useful life of ten years and $25,000 salvage value. The company is subject to a 40% tax rate, what is the annual after-tax cash flows that can be generated from this equipment? This is the answer. ($57,200). I need to learn how to do it by hand. Thank you.
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