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) A company is considering replacing an old asset with a new efficient asset. The new asset will cost $400,000 and has a five-year life.
) A company is considering replacing an old asset with a new efficient asset. The new asset will cost $400,000 and has a five-year life. The old asset has a book value of $200,000 and if the old asset is replaced it can be sold today for a market value of $100,000. Determine the net cash outlay of replacing the old asset with the new asset given a 30% tax rate.
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