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Builtrite is considering purchasing a new machine that would cost $90,000 and the machine would be depreciated (straight line) down to $0 over its five-year
Builtrite is considering purchasing a new machine that would cost $90,000 and the machine would be depreciated (straight line) down to $0 over its five-year life. At the end of five years, it is believed that the machine could be sold for $15,000. The current machine being used was purchased 3 years ago at a cost of $60,000 and it is being depreciated down to zero over its 5-year life. The current machine's salvage value now is $20,000. The new machine would increase EBDT by $44,000 annually. Builtrite's marginal tax rate is 34%. What the RATFCF's associated with the purchase of this machine? O $34,230 O $31,080 O $28,720 O $25,080
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