Suppose you sell a fixed asset for $86,000 when it's book value is $102,000. If your...

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Suppose you sell a fixed asset for $86,000 when it's book value is $102,000. If your...

Suppose you sell a fixed asset for $86,000 when it's book value is $102,000. If your company's marginal tax rate is 21%, what will be the effect on cash flows of this sale (i.e., what will be the after-tax cash flow of this sale)?

business finance

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Answer 1

Answer #1

Solution: sale value Book value Loss on sale Tax shield on loss=16000*0.21 after-tax cash flow from sale=86000+3360 86000 102

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Answer 2

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Suppose you sell a fixed asset for $86,000 when it's book value is $102,000. If your...

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Suppose you sell a fixed asset for $86,000 when it's book value is $102,000. If your...

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Suppose you sell a fixed asset for $117,000 when its book value is $137,000. If your...

Suppose you sell a fixed asset for $128,000 when its book value is $148,000. If your...

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Homework Answers

Add Answer to: Suppose you sell a fixed asset for $86,000 when it's book value is $102,000. If your...

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Add Answer to:
Suppose you sell a fixed asset for $86,000 when it's book value is $102,000. If your...