Question
Southwest Airlines just bought a new jet for $26,000,000. The jet falls into the 7-year MACRS category, with the following depreciation rates (half-year convention): Year
Southwest Airlines just bought a new jet for $26,000,000. The jet falls into the 7-year MACRS category, with the following depreciation rates (half-year convention):
Year 1 2 3 4 5 6 7 8
Depr. rate 14.29% 24.49% 17.49% 12.49% 8.93% 8.92% 8.93% 4.46%
The jet can be sold for $20,800,000 after 5 years. The company has a marginal tax rate of 34%.
What is the after-tax salvage value at the end of year 5?
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Practical Financial Management
Authors: William R. Lasher
7th edition
128560721X, 9781133593669, 1133593682, 9781285607214, 978-1133593683
