Cost recovery. Richardses' Tree Farm, Inc. purchased a new aerial tree trimmer for $94,000. It is classified in the property class category of a single-purpose agricultural and horticultural structure. Then the company sold the tree trimmer after four years of service. If a seven-year life and MACRS, E , was used for the depreciation schedule, what is the after-tax cash flow from the sale of the trimmer (use a 40% tax rate) if a. the sales price was $35,000? b. the sales price was $29,365.60? c. the sales price was $21,000? Data Table a. If the sales price is $35,000, what is the after-tax cash flow? MACRS Fixed Annual Expense Percentages by Recovery Class (Round to the nearest cent.) Click on this icon o to download the data from this table b. If the sales price is $29,365.60, what is the after-tax cash flow? (Round to the nearest cent.) Year 3-Year 5-Year 7-Year 10-Year 1 33.33% 20.00% 14.29% 10.00% c. If the sales price is $21,000, what is the after-tax cash flow? 44.45% 32.00% 24.49% 18.00% (Round to the nearest cent.) 14.81% 19.20% 17.49% 14.40% 4 7.41% 11.52% 12.49% 11.52% 11.52% 8.93% 9.22% 5.76% 8.93% 7.37% 7 8.93% 6.55% 8 4.45% 6.55% 6.55% 10 6.55% 11 3.28%
Cost recovery. Richardses' Tree Farm, Inc. purchased a new aerial tree trimmer for $94,000. It is classified in the property class category of a single-purpose agricultural and horticultural structure. Then the company sold the tree trimmer after four years of service. If a seven-year life and MACRS, E , was used for the depreciation schedule, what is the after-tax cash flow from the sale of the trimmer (use a 40% tax rate) if a. the sales price was $35,000? b. the sales price was $29,365.60? c. the sales price was $21,000? Data Table a. If the sales price is $35,000, what is the after-tax cash flow? MACRS Fixed Annual Expense Percentages by Recovery Class (Round to the nearest cent.) Click on this icon o to download the data from this table b. If the sales price is $29,365.60, what is the after-tax cash flow? (Round to the nearest cent.) Year 3-Year 5-Year 7-Year 10-Year 1 33.33% 20.00% 14.29% 10.00% c. If the sales price is $21,000, what is the after-tax cash flow? 44.45% 32.00% 24.49% 18.00% (Round to the nearest cent.) 14.81% 19.20% 17.49% 14.40% 4 7.41% 11.52% 12.49% 11.52% 11.52% 8.93% 9.22% 5.76% 8.93% 7.37% 7 8.93% 6.55% 8 4.45% 6.55% 6.55% 10 6.55% 11 3.28%
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Question 6
![Cost recovery. Richardses' Tree Farm, Inc. purchased a new aerial tree trimmer for $94,000. It is classified in the property class category of a single-purpose
agricultural and horticultural structure. Then the company sold the tree trimmer after four years of service. If a seven-year life and MACRS, E, was used for the
depreciation schedule, what is the after-tax cash flow from the sale of the trimmer (use a 40% tax rate) if
a. the sales price was $35,000?
b. the sales price was $29,365.60?
c. the sales price was $21,000?
Data Table
a. If the sales price is $35,000, what is the after-tax cash flow?
MACRS Fixed Annual Expense Percentages by Recovery Class
(Round to the nearest cent.)
Click on this icon 9 to download the data from this table
b. If the sales price is $29,365.60, what is the after-tax cash flow?
(Round to the nearest cent.)
Year
3-Year
5-Year
7-Year
10-Year
1
33.33%
20.00%
14.29%
10.00%
c. If the sales price is $21,000, what is the after-tax cash flow?
2
44.45%
32.00%
24.49%
18.00%
$
(Round to the nearest cent.)
3
14.81%
19.20%
17.49%
14.40%
4
7.41%
11.52%
12.49%
11.52%
11.52%
8.93%
9.22%
6
5.76%
8.93%
7.37%
7
8.93%
6.55%
8
4.45%
6.55%
9
6.55%
10
6.55%
11
3.28%](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F8a986b02-ba6c-4ef1-b256-a9c9c22af021%2Fcfede8f8-a808-43d8-912a-3d15cf09a2bd%2F66lcxpg_processed.png&w=3840&q=75)
Transcribed Image Text:Cost recovery. Richardses' Tree Farm, Inc. purchased a new aerial tree trimmer for $94,000. It is classified in the property class category of a single-purpose
agricultural and horticultural structure. Then the company sold the tree trimmer after four years of service. If a seven-year life and MACRS, E, was used for the
depreciation schedule, what is the after-tax cash flow from the sale of the trimmer (use a 40% tax rate) if
a. the sales price was $35,000?
b. the sales price was $29,365.60?
c. the sales price was $21,000?
Data Table
a. If the sales price is $35,000, what is the after-tax cash flow?
MACRS Fixed Annual Expense Percentages by Recovery Class
(Round to the nearest cent.)
Click on this icon 9 to download the data from this table
b. If the sales price is $29,365.60, what is the after-tax cash flow?
(Round to the nearest cent.)
Year
3-Year
5-Year
7-Year
10-Year
1
33.33%
20.00%
14.29%
10.00%
c. If the sales price is $21,000, what is the after-tax cash flow?
2
44.45%
32.00%
24.49%
18.00%
$
(Round to the nearest cent.)
3
14.81%
19.20%
17.49%
14.40%
4
7.41%
11.52%
12.49%
11.52%
11.52%
8.93%
9.22%
6
5.76%
8.93%
7.37%
7
8.93%
6.55%
8
4.45%
6.55%
9
6.55%
10
6.55%
11
3.28%
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