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attempt all A bakery invests $40,000 in a light delivery truck. This was depreciated using the five-year MACRS schedule shown above. If the company sold
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A bakery invests $40,000 in a light delivery truck. This was depreciated using the five-year MACRS schedule shown above. If the company sold it immediately after the end of year 2 for $23,000, what would be the after-tax cash flow from the sale of this asset, given a tax rate of 20% ? A. $11,520 B. $11,480 C. $2,296 D. $20,704 SIROM Scientific Solutions has $10 million of outstanding equity and $5 million of bank debt. The bank debt costs 7% per year. The estimated equity beta is 2 . If the market risk premium is 7% and the risk-free rate is 4%, compute the weighted average cost of capital if the firm's tax rate is 25%. A. 15.81% B. 13.75% C. 15.13% D. 14.44%Step by Step Solution
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