Consider an asset that costs $311,000 and is depreciated straight-line to zero over its six-year tax life. The asset is to be used in a four-year project; at the end of the project, the asset can be sold for $58,000. If the relevant tax rate is 21 percent, what is the aftertax cash flow from the sale of this asset? a $42,473.33 b $68,411.19 с $40,466.67 d e $67,590.00 $70,103.33
Consider an asset that costs $311,000 and is depreciated straight-line to zero over its six-year tax life. The asset is to be used in a four-year project; at the end of the project, the asset can be sold for $58,000. If the relevant tax rate is 21 percent, what is the aftertax cash flow from the sale of this asset? a $42,473.33 b $68,411.19 с $40,466.67 d e $67,590.00 $70,103.33
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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Consider an asset that costs $311,000 and is depreciated straight-line to zero over
its six-year tax life. The asset is to be used in a four-year project; at the end of the
project, the asset can be sold for $58,000. If the relevant tax rate is 21 percent,
what is the aftertax cash flow from the sale of this asset?
a $42,473.33
b
$68,411.19
$40,466.67
d
$67,590.00
$70,103.33](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F940df111-eb60-4389-8a6b-413683f06bcc%2Fd356a924-9898-409e-a1b2-babb20dc408e%2Fydza31s_processed.jpeg&w=3840&q=75)
Transcribed Image Text:e
n
Consider an asset that costs $311,000 and is depreciated straight-line to zero over
its six-year tax life. The asset is to be used in a four-year project; at the end of the
project, the asset can be sold for $58,000. If the relevant tax rate is 21 percent,
what is the aftertax cash flow from the sale of this asset?
a $42,473.33
b
$68,411.19
$40,466.67
d
$67,590.00
$70,103.33
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