An asset used in a 4-year project falls in the 5-year MACRS class ( MACRS Table

Question

An asset used in a 4-year project falls in the 5-year MACRS class (MACRS Table) for tax purposes. The asset has an acquisition cost of $19,080,000 and will be sold for $4,240,000 at the end of the project.

  

If the tax rate is 33 percent, what is the aftertax salvage value of the asset?

  
rev: 09_18_2012

An asset used in a 4-year project falls in the 5-year MACRS class (MACRS Table) for tax purposes. The asset has an acquisition cost of $19,080,000 and will be sold for $4,240,000 at the end of the project.

Explanation / Answer

WDV 0      100.00 14840000 14,840,000.00 1        80.00 11,872,000.00 2        54.40     6,458,368.00 3        43.96     2,838,788.57 4        38.89     1,104,049.19 Salvage 4240000 WDV     1,104,049.19 Gain     3,135,950.81 Tax     1,034,863.77 After tax salvage     3,205,136.23

Related Questions

Navigate

• Browse (All)
• Browse A
• Subjects

---

---

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.