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Maxine Corporation purchased equipment for $20,400. The equipment has an estimated life of six years and an estimated disposal value of $2,000, but for tax

Maxine Corporation purchased equipment for $20,400. The equipment has an estimated life of six years and an estimated disposal value of $2,000, but for tax purposes the salvage value will be zero. Maxine sold for $3,000 the old equipment that had an undepreciated cost of $2,500. Assuming a tax rate of 40- percent, how much was the cash outlay for the new equipment?

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