Question
Dog Up! Franks is looking at a new sausage system with an installed cost of $700,000. This cost will be depreciated straight-line to zero over
Dog Up! Franks is looking at a new sausage system with an installed cost of $700,000. This cost will be depreciated straight-line to zero over the projects 6-year life, at the end of which the sausage system can be scrapped for $94,000. The sausage system will save the firm $201,000 per year in pretax operating costs, and the system requires an initial investment in net working capital of $53,000. What is the aftertax salvage value of the equipment if the tax rate is 23%? Note: Do not round intermediate calculations and round your answer to the nearest whole number, e.g., 32.
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