Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Your firm needs a computerized machine tool lathe which costs $ 4 6 , 0 0 0 and requires $ 1 1 , 6 0

Your firm needs a computerized machine tool lathe which costs $46,000 and requires $11,600 in maintenance for each year of its 3-year life. After three years, this machine will be replaced. The machine falls into the MACRS 3-year class life category, and neither bonus depreciation nor Section 179 expensing can be used. Assume a tax rate of 21 percent and a discount rate of 13 percent.
If the lathe can be sold for $4,600 at the end of year 3, what is the after-tax salvage value?
Note: Round your answer to 2 decimal places.
Answer is complete but not entirely correct.
\table[[Salvage value after tax,$,1,430.65x
image text in transcribed

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image_2

Step: 3

blur-text-image_3

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Market Regulations And Finance

Authors: Ratan Khasnabis, Indrani Chakraborty

2014th Edition

8132217942, 978-8132217947

More Books

Students also viewed these Finance questions

Question

How We Listen?

Answered: 1 week ago