for $745,000 at the end of the project. The asset is in the 5-year MACRS class. The depreciation percentage each year is 20.00 percent, 32.00 percent, 19.20 percent, 11.52 percent, and 11.52 percent, respectively. The company's tax rate is 21 percent. What is the aftertax salvage value of the equipment?
for $745,000 at the end of the project. The asset is in the 5-year MACRS class. The depreciation percentage each year is 20.00 percent, 32.00 percent, 19.20 percent, 11.52 percent, and 11.52 percent, respectively. The company's tax rate is 21 percent. What is the aftertax salvage value of the equipment?
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:O
$745,000
$775,042
$491,700
$566,119
$726,444
Transcribed Image Text:A company is evaluating a new 4-year project. The equipment necessary for the project will cost $3,800,000 and can be sold
for $745,000 at the end of the project. The asset is in the 5-year MACRS class. The depreciation percentage each year is
20.00 percent, 32.00 percent, 19.20 percent, 11.52 percent, and 11.52 percent, respectively. The company's tax rate is 21
percent. What is the aftertax salvage value of the equipment?
Multiple Choice
$745,000
$775,042
$491,700
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