An equipment purchased at a cost $80,000 by a local company is being depreciated using MACRS...
|
An equipment purchased at a cost $80,000 by a local company is being depreciated using MACRS method as a 5-year property. At the end of four years, the management decided to sell the equipment for a modest price of $20,000. The company is in the 34% tax bracket. Compute the tax consequence on the sale of this equipment. |
|||
| A.
$6,800 |
|||
| B.
$926.40 |
|||
| C.
$533.12 |
|||
| D.
None of these |
|||
Homework Answers
The depreciation for the first four years under MACRS
= 20%+32%+19.20%+11.52% = 82.72%
Book value = 80000-(82.72% of 80000) = 80000-66176 = 13824
The gain on the sale = 20000-13824 = 6176
The tax consequence is 34% of the 6176 = 2100
option(D) none of these
Add Answer to:
An equipment purchased at a cost $80,000 by a local company is
being depreciated using MACRS...
Question 2 0 out of 10 points An equipment purchased at a cost $80,000 by a...
Question 2 0 out of 10 points An equipment purchased at a cost $80,000 by a local company is being depreciated using MACRS method as a 5-year property. At the end of four years, the management decided to sell the equipment for a modest price of $20,000. The company is in the 34% tax bracket. Compute the tax consequence on the sale of this equipment. Selected Answer: D. None of these Answers: A. $6,800 B. $926.40 C. $533.12 D. None...
Question 2 0 out of 10 points An equipment purchased at a cost $80,000 by a...
Question 2 0 out of 10 points An equipment purchased at a cost $80,000 by a local company is being depreciated using MACRS method as a 5-year property. At the end of four years, the management decided to sell the equipment for a modest price of $20,000. The company is in the 34% tax bracket. Compute the tax consequence on the sale of this equipment. Selected Answer: D. None of these Answers: A. $6,800 B. $926.40 C. $533.12 D. None...
A distribution center purchased an equipment for $100,000 and has depreciated the equipment using the MACRS...
A distribution center purchased an equipment for $100,000 and has depreciated the equipment using the MACRS depreciation schedule as a 7-year property. The operating income in year 2 was $200,000 and the expenses were $87,000. If the company is in the 40% income tax bracket, determine the after-tax cash flow in year 2 The income tax in year 2 is equal to __________________.
Three-year property class type equipment bought for $30,000 is being disposed of $20,000 at the end...
Three-year property class type equipment bought for $30,000 is being disposed of $20,000 at the end of three years. The company is at a 21% tax bracket. Compute the tax consequence, if any for this equipment.
"A local delivery company has purchased a delivery truck for $11,000. The truck will be depreciated...
"A local delivery company has purchased a delivery truck for $11,000. The truck will be depreciated under MACRS as a five-year property. The trucks market value (salvage value) is expected to decrease by $2,900 per year. It is expected that the purchase of the truck will increase its revenue by $15,000 annually. The O&M costs are expected to be $2,300 per year. The firm is in the 40% tax bracket, and its MARR is 12.1%. If the company plans to...
Hello, I need help with the following question: I5 points) Three-year property class type equipment bought...
Hello, I need help with the following question:
I5 points) Three-year property class type equipment bought for $30,000 is being disposed of $20,000 at the end of three years. The company is at a 34% tax bracket. Compute the tax consequence, if any for this equipment. Show your work including the depreciation, book value, amount of gains and tax calculation. 7
Diamond systems is purchasing equipment for $850,000. The equipment will be depreciated using the three-year MACRS...
Diamond systems is purchasing equipment for $850,000. The equipment will be depreciated using the three-year MACRS schedule and will be worth $140,000 at the end of three years. costs will be reduced 500,000 annually and net working capital can be reduced by 75,000. Diamond systems is using the 35% tax bracket & requires an 18 percent return on all projects. What is the NPV?
Crane Corporation just purchased computing equipment for $21,000. The equipment will be depreciated using a five...
Crane Corporation just purchased computing equipment for $21,000. The equipment will be depreciated using a five year MACR depreciation schedule. If the equipment is sold at the end of its fourth year for $15.000, what are the after-tax proceeds from the sale, assuming the marginal tax rate is 35 percent Round answer to 2 decimal places 1525) EXHIBIT 11.7 MACRS Depreciation Schedules by Allowable Recovery Pried The MACRS schedule is the depreciations that time to place to he Tax Act...
A $500,000 piece of production equipment has been purchased by a contract manufacturing company to meet the specific needs of a customer. The customer awarded the manufacturing company a 4-year contra...
A $500,000 piece of production equipment has been purchased by a contract manufacturing company to meet the specific needs of a customer. The customer awarded the manufacturing company a 4-year contract with the possibility of extending the contract for another 4 years. The company plans to use the MACRS depreciation method for this equipment as a 7-year property for tax purposes. The income tax rate for the company is 39%, and it expects to have an after -tax rate of...
ABC Company is considering the purchase of a new machine for $80,000 installed. The machine will be depreciated by MACR...
ABC Company is considering the purchase of a new machine for $80,000 installed. The machine will be depreciated by MACRS as 5 year property. The firm expects to operate the machine for 4 years and then to sell it for $11,750. If the marginal tax rate is 25.00%, what will the after-tax salvage value be when the machine is sold at the end of Year 4? Enter your answer rounded to two decimal places. Do not enter $ or comma...
Question 2 0 out of 10 points An equipment purchased at a cost $80,000 by a local company is being depreciated using MACRS method as a 5-year property. At the end of four years, the management decided to sell the equipment for a modest price of $20,000. The company is in the 34% tax bracket. Compute the tax consequence on the sale of this equipment. Selected Answer: D. None of these Answers: A. $6,800 B. $926.40 C. $533.12 D. None...
Question 2 0 out of 10 points An equipment purchased at a cost $80,000 by a local company is being depreciated using MACRS method as a 5-year property. At the end of four years, the management decided to sell the equipment for a modest price of $20,000. The company is in the 34% tax bracket. Compute the tax consequence on the sale of this equipment. Selected Answer: D. None of these Answers: A. $6,800 B. $926.40 C. $533.12 D. None...
Three-year property class type equipment bought for $30,000 is being disposed of $20,000 at the end of three years. The company is at a 21% tax bracket. Compute the tax consequence, if any for this equipment.
Hello, I need help with the following question:
I5 points) Three-year property class type equipment bought for $30,000 is being disposed of $20,000 at the end of three years. The company is at a 34% tax bracket. Compute the tax consequence, if any for this equipment. Show your work including the depreciation, book value, amount of gains and tax calculation. 7
Crane Corporation just purchased computing equipment for $21,000. The equipment will be depreciated using a five year MACR depreciation schedule. If the equipment is sold at the end of its fourth year for $15.000, what are the after-tax proceeds from the sale, assuming the marginal tax rate is 35 percent Round answer to 2 decimal places 1525) EXHIBIT 11.7 MACRS Depreciation Schedules by Allowable Recovery Pried The MACRS schedule is the depreciations that time to place to he Tax Act...
ABC Company is considering the purchase of a new machine for $80,000 installed. The machine will be depreciated by MACRS as 5 year property. The firm expects to operate the machine for 4 years and then to sell it for $11,750. If the marginal tax rate is 25.00%, what will the after-tax salvage value be when the machine is sold at the end of Year 4? Enter your answer rounded to two decimal places. Do not enter $ or comma...
Most questions answered within 3 hours.
-
Direct marketing is also referred to as Question 50 options: 1)
one-to-one marketing. 2) business-customer marketing....
asked 59 seconds from now -
INK Ltd is grocery retailer with 103 shops around South
Australia and Tasmania. The company has...
asked 4 minutes ago -
HOW BEER IS MADE
The beer making process is an art. It takes time, patience and...
asked 5 minutes ago -
What two methods could be used to purify the dimethyl
fumarate?
Based on the 12 Principles...
asked 14 minutes ago -
Reflect upon the readings and videos as well as our Media Monday
discussion. Integrating concepts from...
asked 19 minutes ago -
1. A cylindrical capacitor with A = 0.01, B = 0.1 and a length
of 5...
asked 26 minutes ago -
Explain how taking an SGLT-2 inhibitor, along with taking
insulin leads to ketoacidosis in people who...
asked 34 minutes ago -
Show the truth table of the
gates needed to control the PISO internal FF, has a...
asked 38 minutes ago -
If X ~ N(50; 100); Determine the value of '' k '' for both
situation:
a)...
asked 56 minutes ago -
In paired t-test, what's the difference between using pooled
variance and using the standard deviation of...
asked 57 minutes ago -
What are the major ethical theories, and how do they apply to
the role of a...
asked 57 minutes ago -
''Driving the call for multilateralism in trade at the summit
was Chinese President Xi Jinping, whose...
asked 51 minutes ago