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A corporation has decided to replace an existing machine with a newer model. The old machine had an initial purchase price of $35,000, and has

A corporation has decided to replace an existing machine with a newer model. The old machine had an initial purchase price of $35,000, and has $20,000 in accumulated depreciation. If the 40% tax rate applies to the corporation and the old asset can be sold for $10,000, what will be the tax effect of the replacement? Round to the whole number.

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