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The New Town store bought some display shelves 5 years ago for $60,000. They have been depreciating them on a straight line basis over 10 years. The effective tax rate for the store is 40%. What is the net cash flow:   PART A:If they sell the cases for $40,000? A) $25,000 B) $34,000 C) $40,000 D) $10,000   PART B:If they sell the cases for $20,000? A) $26,000 B) $20,000 C) $30,000 D) $60,000   PART C: If they sell the cases for $30,000? A) $10,000 B) $0 C) $30,000 D) $20,000

The New Town store bought some display shelves 5 years ago for $60,000. They have been depreciating them on a straight line basis over 10 years. The effective tax rate for the store is 40%. What is the net cash flow:   PART A:If they sell the cases for $40,000? A) $25,000 B) $34,000 C) $40,000 D) $10,000   PART B:If they sell the cases for $20,000? A) $26,000 B) $20,000 C) $30,000 D) $60,000   PART C: If they sell the cases for $30,000? A) $10,000 B) $0 C) $30,000 D) $20,000

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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The New Town store bought some display shelves 5 years ago for $60,000. They have been depreciating them on a straight line basis over 10 years. The effective tax rate for the store is 40%. What is the net cash flow:

 

PART A:

If they sell the cases for $40,000?

  1. A) $25,000
  2. B) $34,000
  3. C) $40,000
  4. D) $10,000

 

PART B:
If they sell the cases for $20,000?

  1. A) $26,000
  2. B) $20,000
  3. C) $30,000
  4. D) $60,000

 

PART C:
If they sell the cases for $30,000?

  1. A) $10,000
  2. B) $0
  3. C) $30,000
  4. D) $20,000
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