Question
Voxland Industries purchased a computer for $10,000, which it will depreciate straight-line over five years to a $1,000 salvage value. The computer will then be
Voxland Industries purchased a computer for $10,000, which it will depreciate straight-line over five years to a $1,000 salvage value. The computer will then be sold at that price. The company's marginal tax rate is 31%. Calculate the cash flows associated with the computer from its purchase to its eventual sale including the years in between. (Hint: Depreciate the difference between the cost of the computer and the salvage value. At the end of the depreciation life, a net book value remains that is equal to the salvage value.) Enter your final answers in thousands of dollars. Round your answers to two decimal places. Use a minus sign to indicate negative cash flows or decreases in cash, if required.
Year | Cash Flow |
0 | $ |
1 | $ |
2 | $ |
3 | $ |
4 | $ |
5 | $ |
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