ZuoTi.Pro
Question

Great Western Southern purchased $525,000 of equipment four years ago. The equipment is seven-year MACRS property. The f...

Great Western Southern purchased $525,000 of equipment four years ago. The equipment is seven-year MACRS property. The firm is selling this equipment today for $150,000. What is the after-tax cash flow from this sale if the tax rate is 27 percent? The MACRS allowance percentages are as follows, commencing with Year 1: 14.29, 24.49, 17.49, 12.49, 8.93, 8.92, 8.93, and 4.46 percent. Please explain your answer.

business   finance   
0 0
Add a comment Improve this question Transcribed image text
Next > < Previous
Sort answers by oldest

Homework Answers

Answer #1

Book value on purchase less: accumulated depreciation Book value at the end of year 4 $525,000.00 $360,990.00 $164,010.00 [82

0 0
Add a comment
Know the answer?
Add Answer to:
Great Western Southern purchased $525,000 of equipment four years ago. The equipment is seven-year MACRS property. The f...
Your Answer:

Post as a guest

Your Name:

What's your source?

Earn Coins

Coins can be redeemed for fabulous gifts.

Log In

Sign Up

Not the answer you're looking for? Ask your own homework help question. Our experts will answer your question WITHIN MINUTES for Free.
Similar Homework Help Questions

  • Nashville Wedding Party Downtown Traffic Cloggers purchased $525,000 of equipment four years ago. The equipment is...

    Nashville Wedding Party Downtown Traffic Cloggers purchased $525,000 of equipment four years ago. The equipment is seven-year MACRS property. The firm is selling this equipment today for $150,000. What is the aftertax cash flow from this sale if the tax rate is 27 percent? The MACRS allowance percentages are as follows, commencing with Year 1: 14.29, 24.49, 17.49, 12.49, 8.93, 8.92, 8.93, and 4.46 percent. Multiple Choice Ο $ 152,941.10 Ο $147,057.90 Ο $168,825.81 Ο $166,712.33 Ο $143,096.78

  • ABC Company purchased $50701 of equipment 4 years ago. The equipment is 7-year MACRS property. The...

    ABC Company purchased $50701 of equipment 4 years ago. The equipment is 7-year MACRS property. The firm is selling this equipment today for $4916. What is the After-tax Salvage Value if the tax rate is 20%? The MACRS allowance percentages are as follows, commencing with year one: 14.29, 24.49, 17.49, 12.49, 8.93, 8.92, 8.93, and 4.46 percent.

  • 1) A project has an initial requirement of $ 260,000 for fixed assets and $16,500 for...

    1) A project has an initial requirement of $ 260,000 for fixed assets and $16,500 for net working capital. The fixed assets will be depreciated to a zero-book value over the four-year life of the project and have an estimated salvage value of $50,000. All of the net working capital will be recouped at the end of the project. The annual operating cash flow is $82,500 and the discount rate is 12 percent. What is the project's net present value...

  • 5 years​ ago, Osprey Paper paid​ $1,000,000 for a new machine. The equipment is classified as​...

    5 years​ ago, Osprey Paper paid​ $1,000,000 for a new machine. The equipment is classified as​ 7-year property under MACRS​ (the MACRS rate are listed​ below). If the company has a​ 34% tax rate and sells the equipment today for​ $210,000, what are the​ after-tax proceeds from selling the​ equipment? Year 1 2 3 4 5 6 7 8 Rate​ (%) 14.29 24.49 17.49 12.49 8.94 8.92 8.93 4.46

  • A project requires $414073 of equipment that is classified as 7-year property. What is the book...

    A project requires $414073 of equipment that is classified as 7-year property. What is the book value of this asset at the end of year 3 given the following MACRS depreciation allowances, starting with year one: 14.29, 24.49, 17.49, 12.49, 8.93, 8.92, 8.93, and 4.46 percent?

  • A plece of newly purchased Industrial equipment costs $1,050,000 and is classified as seven-year property under...

    A plece of newly purchased Industrial equipment costs $1,050,000 and is classified as seven-year property under MACRS. The MACRS depreciation schedule is shown in the MACRS Table. Calculate the annual depreciation allowances and end-of-the-year book values for this equipment. (Do not round Intermediate calculations and round your answers to the nearest whole number, e.g., 32. Leave no cells blank. Enter "o" when necessary.) Beginning Book Value Year Depreciation Allowance Ending Book Value Go HILFE Property Class 3-Year5 -Year Year 7-Year...

  • A piece of newly purchased industrial equipment costs $1,030,000 and is classified as seven-year property under...

    A piece of newly purchased industrial equipment costs $1,030,000 and is classified as seven-year property under MACRS. The MACRS depreciation schedule is shown in the MACRS Table Calculate the annual depreciation allowances and end-of-the-year book values for this equipment. (Do not round intermediate calculations and round your answers to the nearest whole number, e.g., 32. Leave no cells blank. Enter "0" when necessary.) points 8 02:59:28 Year Beginning Book Value Depreciation Allowance Ending Book Value 1 eBook Print References 5...

  • A piece of newly purchased industrial equipment costs $728143 and is classified as seven-year property under...

    A piece of newly purchased industrial equipment costs $728143 and is classified as seven-year property under MACRS. What is the book value at the beginning of year 8? (Round your final answer to the nearest dollar amount. Omit the "$" sign and commas in your response. For example, $123,456.78 should be entered as 123457.) Modified ACRS Depreciation Allowances (Table 10.7) Year Three-Year Five-Year Seven-Year 1 33.33% 20.00% 14.29% 2 44.45 32.00 24.49 3 14.81 19.20 17.49 4 7.41 11.52 12.49...

  • An asset used in a four-year project falls in the five-year MACRS class for tax purposes....

    An asset used in a four-year project falls in the five-year MACRS class for tax purposes. The asset has an acquisition cost of $4,850,000 and will be sold for $1,425,000 at the end of the project. If the tax rate is 21 percent, what is the aftertax salvage value of the asset? Refer to Table 10.7. Year O VOO AWN Property Class Three-Year Five-Year 33.33% 20.00% 44.45 32.00 14.81 19.20 7.41 11.52 11.52 5.76 Seven-Year 14.29% 24.49 17.49 12.49 8.93...

  • A piece of newly purchased industrial equipment costs $1,375,000 and is classified as seven-year property under...

    A piece of newly purchased industrial equipment costs $1,375,000 and is classified as seven-year property under MACRS. The MACRS depreciation schedule is shown in Table 10.7. Calculate the annual depreciation allowances and end-of-the-year book values for this equipment. (Leave no cells blank - be certain to enter "O" wherever required. Do not round intermediate calculations and round your answers to 2 decimal places, e.g., 32.16.) Depreciation Year Beginning Book Value Ending Book Value 1 2 3 4 6 7 Property...

ADVERTISEMENT
Free Homework Help App
Download From Google Play
Scan Your Homework
to Get Instant Free Answers
Need Online Homework Help?
Ask a Question
Get Answers For Free
Most questions answered within 3 hours.
ADVERTISEMENT
ADVERTISEMENT
ADVERTISEMENT