Ganyao's firm, InvesTek, manufactures silicon wafers for the high-tech industry. His firm just paid $7,600,000 for a piece of equipment that's classified as a 3-year asset according to MACRS. His firm plans to use the equipment for a project that lasts 4 years, and then sell the equipment for $655,000. InvesTek's corporate tax rate is 35%. MACRS depreciation rates are as follows: Year 1: 33.33%, Year 2: 44.45%, Year 3: 14.81%, and Year 4: 7.41%. What is the net after-tax salvage cash flow from selling this equipment at the end of the project? selling price= net book value= gain/loss= taxes= net cash flow=
Ganyao's firm, InvesTek, manufactures silicon wafers for the high-tech industry. His firm just paid $7,600,000 for a piece of equipment that's classified as a 3-year asset according to MACRS. His firm plans to use the equipment for a project that lasts 4 years, and then sell the equipment for $655,000. InvesTek's corporate tax rate is 35%. MACRS depreciation rates are as follows: Year 1: 33.33%, Year 2: 44.45%, Year 3: 14.81%, and Year 4: 7.41%. What is the net after-tax salvage cash flow from selling this equipment at the end of the project? selling price= net book value= gain/loss= taxes= net cash flow=
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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Ganyao's firm, InvesTek, manufactures silicon wafers for the high-tech industry. His firm just paid $7,600,000 for a piece of equipment that's classified as a 3-year asset according to MACRS. His firm plans to use the equipment for a project that lasts 4 years, and then sell the equipment for $655,000. InvesTek's corporate tax rate is 35%. MACRS
What is the net after-tax salvage cash flow from selling this equipment at the end of the project?
selling price=
net book value=
gain/loss=
taxes=
net cash flow=
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