Edward's Manufactured Homes purchased some machinery 2 years ago for $52,000. The assets are classified as 5-year property for MACRS. The company is replacing this machinery today with newer machines that utilize the latest in technology. The old machines are being sold for $18,000 to a foreign firm for use in its production facility in South America. What is the aftertax salvage value from this sale if the tax rate is 34 percent?

MACRS 5-year property

Year

Rate

1

20.00%

2

32.00%

3

19.20%

4

11.52%

5

11.52%

6

5.76%

$24,960.00 $16,971.84 $20,366.40 $19,293.70 $18,000.00