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In 2015, a delivery company purchased a fleet of local delivery trucks for $175,000. These are 5 year assets. This company pays federal tax at
In 2015, a delivery company purchased a fleet of local delivery trucks for $175,000. These are 5 year assets. This company pays federal tax at a rate of 23% per year.
- Develop a MACRS depreciation table for this asset, and compute the post-tax income of this company using their gross sales income given below.
- Is this a good investment if MARR = 25% per year?
- The company sold the trucks in September 2020 for $18,000. What are the tax implications?
| Year | Gross Annual Income | di | Di | Taxable Income | Tax paid | Post-Tax income |
| 2015 | $250,000 |
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| 2016 | $350,000 |
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| 2017 | $30,000 |
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| 2018 | $150,000 |
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| 2019 | $165,000 |
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| 2020 | $65,000 |
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