$472,250
After tax salvage value = Market value of equipment -/+ Tax on Profit on sale/Tax shield on loss on sale
Please refer to below spreadsheet for calculation and answer. Cell reference also provided.
Cell reference -
Hope this will help, please do comment if you need any further explanation. Your feedback would be highly appreciated.
please ignore the selected answer! Power Manufacturing has equipment that it purchased 6 years ago for...
Power Manufacturing has equipment that it purchased 6 years ago for $2,700,000. The equipment was used for a project that was intended to last for 8 years. However, due to low demand, the project is being shut down. The equipment was depreciated using the straight-line method and can be sold for $430,000 today. The company's tax rate is 40 percent. What is the aftertax salvage value of the equipment? Multiple Choice O $602,000 O $430,000 O $332,000 O $479,000 O...
Power Manufacturing has equipment that it purchased 7 years ago for $2,750,000. The equipment was used for a project that was intended to last for 9 years. However, due to low demand, the project is being shut down. The equipment was depreciated using the straight-line method and can be sold for $440,000 today. The company's tax rate is 34 percent. What is the aftertax salvage value of the equipment? $440,000 $381,822 $440,000 $498,178 $589,600
Power Manufacturing has equipment that it purchased 5 years ago for $2,450,000. The equipment was used for a project that was intended to last for 7 years. However, due to low demand, the project is being shut down. The equipment was depreciated using the straight-line method and can be sold for $380,000 today. The company's tax rate is 34 percent. What is the after-tax salvage value of the equipment? Multiple Choice $509,200 $488,800 $380,000 $271,200
Power Manufacturing has equipment that it purchased 7 years ago for $1,950,000. The equipment was used for a project that was intended to last for 9 years. However, due to low demand, the project is being shut down. The equipment was depreciated using the straight-line method and can be sold for $280,000 today. The company's tax rate is 40 percent. What is the aftertax salvage value of the equipment? rev: 06_18_2018_QC_CS-129446 $310,667 $341,333 $218,667 $392,000 $280,000
Pear Orchards is evaluating a new project that will require equipment of $223,000. The equipment will be depreciated on a 5-year MACRS schedule. The annual depreciation percentages are 20.00 percent, 32.00 percent, 19.20 percent, 11.52 percent, and 11.52 percent, respectively. The company plans to shut down the project after 4 years. At that time, the equipment could be sold for $50,200. However, the company plans to keep the equipment for a different project in another state. The tax rate is...
Dallas Engineering purchased a machine five years ago at a cost of $484,000. The machine is being depreciated using the straight-line method over eight years. The tax rate is 25 percent and the discount rate is 13 percent. If the machine is sold today for $209,000, what will the aftertax salvage value be? $202,125 $227,485 $214,500 $194,000 $186,775
BW Construction Materials purchased a machine six years ago at a cost of $810,000. The machine is being depreciated using the straight-line method over ten years. The tax rate is 25 percent and the discount rate is 10 percent. If the machine is sold today for $375,000, what will the aftertax salvage value be? $350,040 $321,460 $384,500 $362,250 $294,570
Pear Orchards is evaluating a new project that will require equipment of $217,000. The equipment will be depreciated on a 5-year MACRS schedule. The annual depreciation percentages are 20.00 percent, 32.00 percent, 19.20 percent, 11.52 percent, and 11.52 percent, respectively. The company plans to shut down the project after 4 years. At that time, the equipment could be sold for $46,300. However, the company plans to keep the equipment for a different project in another state. The tax rate is...
Pear Orchards is evaluating a new project that will require equipment of $235,000. The equipment will be depreciated on a 5-year MACRS schedule. The annual depreciation percentages are 20.00 percent, 32.00 percent, 19.20 percent, 11.52 percent, and 11.52 percent, respectively. The company plans to shut down the project after 4 years. At that time, the equipment could be sold for $58,000. However, the company plans to keep the equipment for a different project in another state. The tax rate is...
Pear Orchards is evaluating a new project that will require equipment of $241,000. The equipment will be depreciated on a 5-year MACRS schedule. The annual depreciation percentages are 20.00 percent, 32.00 percent, 19.20 percent, 11.52 percent, and 11.52 percent, respectively. The company plans to shut down the project after 4 years. At that time, the equipment could be sold for $61,900. However, the company plans to keep the equipment for a different project in another state. The tax rate is...