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2. the revenue is $42,000, the cost of goods is sold 21,000, other expenses (from selling...

2. the revenue is $42,000, the cost of goods is sold 21,000, other expenses (from selling and administration are $6000, and depreciation is 2,000. What is EBIT?
A) $13,000
B) $29,000
C) $4,000
D) $2,000

7) Eastern Inc. purchases a machine for $15,000. This machine qualifies as a five-year recovery asset under MACRS with the fixed depreciation percentages as follows: year 1 = 20.00%; year 2 = 32.00%; year 3 = 19.20%; year 4 = 11.52%. Eastern has a tax rate of 20%. If the machine is sold at the end of four years for $4,000, what is the cash flow from disposal?
A) $3,718.40
B) $3,535.36
C) $2,592.00
D) $1,408.00

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