Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Your firm needs a computerized machine tool lathe which costs $ 5 0 , 0 0 0 and requires $ 1 2 , 0 0

Your firm needs a computerized machine tool lathe which costs $50,000 and requires $12,000 in maintenance for each year of its 3year 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 12 percent.
If the lathe can be sold for $5,000 at the end of year 3, what is the after-tax salvage value? (Round your answer to 2 decimal places.)
Salvage value after tax $$4,728.05
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

Step: 3

blur-text-image

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

QFinance The Ultimate Resource

Authors: Various Authors

1st Edition

1849300003, 978-1849300001

More Books

Students also viewed these Finance questions

Question

9. How does one identify the essential functions of a job?

Answered: 1 week ago

Question

a 2 - to 3 - page evaluation report of the AWS cloud solutions

Answered: 1 week ago