Question
Cost recovery. Brock Florist Company bought a new delivery truck for 29,000. It was classified as a light-duty truck. The company sold its delivery truck
Cost recovery. Brock Florist Company bought a new delivery truck for 29,000. It was classified as a light-duty truck. The company sold its delivery truck after three years of service. If a five-year life and MACRS, , was used for the depreciation schedule, what is the after-tax cash flow from the sale of the truck (use a 40% tax rate)
MACRS Fixed Annual Expense Percentages by Recovery Class
Year | 3-Year | 5-Year | 7-Year | 10-Year |
|
1 | 33.33% | 20.00% | 14.29% | 10.00% | |
2 | 44.45% | 32.00% | 24.49% | 18.00% | |
3 | 14.81% | 19.20% | 17.49% | 14.40% | |
4 | 7.41% | 11.52% | 12.49% | 11.52% | |
5 | 11.52% | 8.93% | 9.22% | ||
6 | 5.76% | 8.93% | 7.37% | ||
7 | 8.93% | 6.55% | |||
8 | 4.45% | 6.55% | |||
9 | 6.55% | ||||
10 | 6.55% | ||||
11 | 3.28% |
A.the sales price was $15,000? B.the sales price was 9,000? C. the sales price was 3,000?
a. If the sales price was 15,000, what would be the after-tax cash flow? (Round to the nearest cent.)b. If the sales price was $9,000,what would be the after-tax cash flow? c.If the sales price was $3,000,what would be the after-tax cash flow be?(Round to the nearest cent.)
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