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A company is considering the purchase of a $200,000 piece of equipment. The equipment is classified as 5-year MACRS property. The company expects to sell

A company is considering the purchase of a $200,000 piece of equipment. The equipment is classified as 5-year MACRS property. The company expects to sell the equipment after five years at a price of $30,000. The relevant tax rate is 20%. What is the after-tax cash flow from this sale?

MACRS 5-year property

Year Rate

1 20.00%

2 32.00%

3 19.20%

4 11.52%

5 11.52%

6 5.76%

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