Problemconsider an asset that costs 264000 and is, Ask an Expert

Accounting

Problem:

Consider an asset that costs $264,000 and is depreciated straight-line to zero over its 13-year tax life. The asset is to be used in a 6-year project; at the end of the project, the asset can be sold for $33,000.

Required:

If the relevant tax rate is 34 percent, what is the after-tax cash flow from the sale of this asset? Hint: If sold at a loss, taxes will be negative, so ATSV = selling price - taxes on gain, would result in subtracting negative taxes.

$73,617.93
$70,112.31
$21,780.00
$672,552.00
$66,606.69

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Accounting Basics, Accounting

Category:- Accounting Basics
Reference No.:- M91167124

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