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Consider an asset that costs $725,000 and is depreciated straight-line to zero over its 10-year tax life. The asset is to be used in a 6-year project; at the end of the project, the asset can be sold for $213,000. If the relevant tax rate is 23 percent, what is the aftertax cash flow from the sale of this asset? Note: Do not round intermediate calculations and round your answer to the nearest whole number, e.g., 32. Aftertax salvage value

Consider an asset that costs $725,000 and is depreciated straight-line to zero over its 10-year tax life. The asset is to be used in a 6-year project; at the end of the project, the asset can be sold for $213,000. If the relevant tax rate is 23 percent, what is the aftertax cash flow from the sale of this asset? Note: Do not round intermediate calculations and round your answer to the nearest whole number, e.g., 32. Aftertax salvage value

Essentials Of Investments
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
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Consider an asset that costs $725,000 and is depreciated straight-line to zero over its 10-year tax life. The asset is to be used in a 6-year project; at the end of the project, the asset can be sold for $213,000. If the relevant tax rate is 23 percent, what is the aftertax cash flow from the sale of this asset? Note: Do not round intermediate calculations and round your answer to the nearest whole number, e.g., 32. Aftertax salvage value
Transcribed Image Text:Consider an asset that costs $725,000 and is depreciated straight-line to zero over its 10-year tax life. The asset is to be used in a 6-year project; at the end of the project, the asset can be sold for $213,000. If the relevant tax rate is 23 percent, what is the aftertax cash flow from the sale of this asset? Note: Do not round intermediate calculations and round your answer to the nearest whole number, e.g., 32. Aftertax salvage value
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