P10-7 Calculating Salvage Value [LO1]

Consider an asset that costs $299,200 and is depreciated straight-line to zero over its 5-year tax life. The asset is to be used in a 3-year project; at the end of the project, the asset can be sold for $37,400. Required : If the relevant tax rate is 32 percent, what is the aftertax cash flow from the sale of this asset? (Do not round your intermediate calculations.)

a. $60,543.12

b. $25,432.00

c. $240,868.00

d. $63,729.60

e. $66,916.08