The machinery costs $200,000, and is to be depreciated using the MACRS, as a 5 year asset. This company uses tax rate of 34% for studies, and the machine is in use for 10 years.

If the machine is sold for $80,000 in the 4^th year,

Note that there are multiple questions based on this problem.

How much is the depreciation charge for the 4^th year?