Score: 0 of 11 pts 4 of complete HW Score: 33%.33 of 100 pts Problem 7-19 (algorithmic) Question Help A company purchases an industriser for $145,000. The device has a useful life of years and a salvage al market value at the end of those four years of $40,000. The before-tax cash flow is estimated to be $70,000 per year a. You, of course, suggested applying the 3-year MACRS (ODS) method instead of the straight line method Given nethet of 21% determine the depreciation schedule and the after tar cash fox B. Based on the MACRS depreciation schedule for this asset it the industrial user was sold for $80,000 in year to consider year two to be the year Zrow in the table in Part (w what will be the amount of gain (depreciation recapture) or loss on the disposal of the set the end of this year? Click the icon to view the GOS Recovery Rates (r) for the 3-year property class. a. Determine the MACRS depreciation amounts and the after tax cash flow for this laser. Fin the table below Round to the nearest dollar) EOY Depreciations ATCE, - 145.000 More Info Year 0.0375 GDS Recovery Rates for the Sta Personal Property Care Recovery Period and Property Class 16-year 0.3333 0.2000 0.1429 0.1000 0.6445 0.3200 0.2409 0.1800 1481 0.1440 0.0741 0.1152 0.1152 0.0770 0.1152 0.0576 0.0892 0.0737 00893 0.0655 1 2 3 4 5 6 7 8 9 10 11 12 13 0.0571 0.0656 0.0655 0.0 15 16 17 18 19 20 21 "These rates are determined by applying the 2005 De method with switchover to the method to the recovery period with the half-year convention applied to the first and last years Rates for each period must sumo 10000 These rates are determined with the 150% method instead of the 2005 method with switchover to the SL method and are rounded off to four decimal places Print Done Problem 7-19 (algorithmic) Question Help A company purchases an industrial laser for $145,000. The device has a useful life of 4 years and a salvage value (market value) at the end of those four years of A. You, of course, suggested applying the 3-year MACRS (GDS) method instead of the straight-line method. Given an effective tax rate of 21%, determine the depreciation schedule and the after tax cash flow. b. Based on the MACRS depreciation schedule for this asset, if the industrial laser was sold for $90,000 in year two (consider year two to be the year 2" row in the table in Part (a), what will be the amount of gain (depreciation recapture) or loss on the disposal of the asset at the end of this year? Click the icon to view the GDS Recovery Rates (7) for the 3-year property class . Determine the MACRS depreciation amounts and the after tax cash flow for this laser. Fill in the table below. (Round to the nearest dollar.) EOY Depreciation, $ ATCF, $ - 145,000 0 1
