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Please answer all three parts to question and round to nearest dollar. Ive attatched tbe question and data table Question Help P11-8 (similar to) Calculating
Please answer all three parts to question and round to nearest dollar. Ive attatched tbe question and data table
Question Help P11-8 (similar to) Calculating initial investment Vastine Medical, Inc., is considering replacing its existing computer system, which was purchased 3 years ago at a cost of $328,000. The system can be sold today for $190,000. It is being depreciated using MACRS and a 5-year recovery period (see the table EEB) A new computer system will cost $497,000 to purchase and install. Replacement of the computer system would not involve any change in net working capital. Assume a 40% tax rate on ordinary income and capital gains. a. Calculate the book value of the existing computer system. b. Calculate the after-tax proceeds of its sale for $190,000. c. Calculate the initial investment associated with the replacement project Step by Step Solution
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