An asset used in a four-year project falls in the five-year MACRS class (MACRS schedule) for tax purposes. The asset has an acquisition cost of $8,600,000 and will be sold for $2,180,000 at the end of the project. If the tax rate is 23 percent, what is the aftertax salvage value of the asset? Note: Do not round intermediate calculations and round your answer to the nearest whole number, e.g., 32.
An asset used in a four-year project falls in the five-year MACRS class (MACRS schedule) for tax purposes. The asset has an acquisition cost of $8,600,000 and will be sold for $2,180,000 at the end of the project. If the tax rate is 23 percent, what is the aftertax salvage value of the asset? Note: Do not round intermediate calculations and round your answer to the nearest whole number, e.g., 32.
Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
Problem 1PS
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![Problem 9-7 Calculating Salvage Value [LO 2]
An asset used in a four-year project falls in the five-year MACRS class (MACRS
schedule) for tax purposes. The asset has an acquisition cost of $8,600,000
and will be sold for $2,180,000 at the end of the project. If the tax rate is 23
percent, what is the aftertax salvage value of the asset?
Note: Do not round intermediate calculations and round your answer to the
nearest whole number, e.g., 32.
Aftertax salvage value
GA
$
1,792,533 X](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F483c3d17-1621-47af-bfd2-86acecf64938%2F3ebf5a2f-ad8b-47cc-9f73-177dcd187003%2Fl7os98_processed.png&w=3840&q=75)
Transcribed Image Text:Problem 9-7 Calculating Salvage Value [LO 2]
An asset used in a four-year project falls in the five-year MACRS class (MACRS
schedule) for tax purposes. The asset has an acquisition cost of $8,600,000
and will be sold for $2,180,000 at the end of the project. If the tax rate is 23
percent, what is the aftertax salvage value of the asset?
Note: Do not round intermediate calculations and round your answer to the
nearest whole number, e.g., 32.
Aftertax salvage value
GA
$
1,792,533 X
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