. A manufacturing company purchased a new machine costing $500,000now (year 0). The machine to be used for welding is depreciated at a 30%declining balance rate for tax purposes. If the machine is to be sold afterseven years,compute the amounts of gains (losses) and the disposal taxeffect for the following three salvage values with a corporate tax rate of35%.a) $ 30,000b) $175,000c) $525,000

The cost of the asset which is spread over the benefits of the estimated useful life of an asset is…

Answered: A manufacturing cc now (year 0). The r…

A manufacturing cc now (year 0). The r declining balance r= seven years,compu effect for the follow 35%. a) $ 30,000 b) $175,000 c) $525,000

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Question

. A manufacturing company purchased a new machine costing $500,000
now (year 0). The machine to be used for welding is depreciated at a 30%
declining balance rate for tax purposes. If the machine is to be sold after
seven years,compute the amounts of gains (losses) and the disposal tax
effect for the following three salvage values with a corporate tax rate of
35%.
a) $ 30,000
b) $175,000
c) $525,000

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