A $ 6 2 , 0 0 0 machine with a 6 - year class life was

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Question:

A $

62, 000

machine with a

6 -

year class life was purchased

2

years ago. The machine will now be sold for $

50, 000

and replaced with a new machine costing $

99, 000,

with a

10 -

year class life. The new machine will not increase sales, but will decrease operating costs by $

17, 000

per year. Simplified straight line depreciation is employed for both machines, and the marginal corporate tax rate is

34

percent. What is the incremental annual cash flow associated with the project?

Posted Date: May 18, 2024 09:15 PM

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A $ 6 2 , 0 0 0 machine with a 6 - year class life was

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