A firm is trying to determine the cash flow from selling an old computer system to an interested buyer. The computer system was purchased five years ago for $427,383.00. The system was depreciated using the 7-year MACRS schedule. The firm has an offer this morning for $75,042.00. The tax rate facing the firm is 35.00%. The firm will only accept the offer if it generates a cash flow greater than $61,452.00.

What is the current book value of the computer system?

A firm is trying to determine the cash flow from selling an old computer system to an interested buyer. The computer system was purchased five years ago for $427,383.00. The system was depreciated using the 7-year MACRS schedule. The firm has an offer this morning for $75,042.00. The tax rate facing the firm is 35.00%. The firm will only accept the offer if it generates a cash flow greater than $61,452.00.

What is the NSV from selling the computer system today?

Answer rating: 100% (QA)

a To determine the current book value of the computer system we need to calculate the total accumula... View the full answer