Problem 17.035: Calculate tax liability in yr2 An in place machine with 8 $145,000 was depreciated by using Modified Accelerated Cost Recovery System (MACRS) over a 3 year period. The machine was sold for $60,000 at the end of year 2 when the company decided to import the item that required the use of the machine. In year 2. gross income (G) $1 million and operating expenses (OE) $500,000. Determine the tax liability in year 2.11 Te-35% The tax liability in year 2 is determined to be s