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BrummittCorporation is evaluating a new 4-year project. The equipment necessary for the project will cost $2,300,000 and can be sold for $293,000 at the end
BrummittCorporation is evaluating a new 4-year project. The equipment necessary for the project will cost $2,300,000 and can be sold for $293,000 at the end of the project. The asset is in the 5-year MACRS class. The depreciation percentage each year is 20.00 percent, 32.00 percent, 19.20 $238,423$293,000$271,068$193,380$314,932 Pear Orchards is evaluating a new project that will require equipment of $223,000. The equipment will be depreciated on a 5-year MACRS schedule. The annual depreciation percentages are 20.00 percent, 32.00 percent, 19.20 percent, 11.52 percent, and 11.52 percent, respectively. The company plans to shut down the project after 4 years. At that time, the equipment could be sold for $50,200. However, the company plans to keep the equipment for a different project in another state. The tax rate is 21 percent. What aftertax salvaling the current project? $0$52,650$50,200$47,750$38,534
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