Microsoft Word - FINC_6317_LR_MBA_FINANCE_QUIZ_3

64. You purchased an asset three years ago at a cost of $135,000 and sold it today for $82,500. The equipment is 5year property for MACRS. The MACRS table values are .2000, .3200, .1920, .1152, .1152, and .0576 for Years 1 to 6, respectively. Which one of the following statements is correct if tax rate is 34 percent?

1. The current book value is $64,800.
2. The taxable amount on the sale is $38,880.
3. The tax due on the sale is $14,830.80.
4. The book value today is $8,478.
5. The aftertax salvage value is $24,049.20.