A firm contemplates buying an asset for $75,000.It will use the asset for 3 years, then sell it for $33,000.The sale will close out the asset's CCA (capital cost allowance) account.The CCA rate for the asset class is 30%.What impact does the sale of the asset have on the NPV of the project in which the asset is used?The discount rate is 10% and the tax rate is 26%.

Answer rating: 100% (QA)

To determine the impact of the asset sale on the net present value NPV of the project we need to con... View the full answer