Calculating initial investment Vastine Medical Inc, is considering replacing its existing computer system, which was purchased 2 years ago at a cost of $331,000. The system can be sold today for $203,000. It is being depreciated using MACRS and a 5-year recovery period (see the table ) A new computer system will cost 5508,000 to purchase and install. Replacement of the computer system would not involve any change in net working capital. Assume a 40% tax rate on ordinary Income and capital gains a. Calculate the book value of the existing computer system b. Calculate the after-tax proceeds of its sale for 5203.000. c. Calculate the initial investment associated with the replacement project a. The remaining book value is $(Round to the nearest dollar) Enter your answer in the answer box and then click Check Answer 2 pants remaining Clear All Check Answer Data Table - X cost of $331,000 system will cost on ordinary Calculating initial The system can be 5508,000 to purchal Income and capital a. Calculate the bod b. Calculate the atte C. Calculate the init a. The remaining bad (Click on the icon here in order to copy the contents of the data table below into a spreadsheet) Rounded Depreciation Percentages by Recovery Year Using MACRS for First Four Property Classes Percentage by recovery year Recovery year 3 years 5 years 7 years 10 years 33% 20% 14% 10% 45% 32% 25% 18% 19% 18% 79 12% 12% 12% 9% 9% 5% 8% 9% 7% 6% 6% 10 6% 11 Totals 100% 100% 100% 100% "These percentages have been rounded to the nearest whole percent to simplify calculations while retaining realism To calculate the actual depreciation for tax purposes, be sure to apply the actual unrounded percentages or directly apply double-declining balance (2009) depreciation using the half-year convention Enter your answer Print Done 2 pants remaining wer