In December of 20x4, Memphis Plastics sold a forklift for $9,255. The machine was purchased in 20x1
Question:
In December of 20x4, Memphis Plastics sold a forklift for $9,255. The machine was purchased in 20x1 for $50,000. Since then $38,845 in depreciation has been recorded on the forklift.
Required:
1. What was the forklift’s book value at the time of sale?
2. Compute the gain or loss on the sale.
3. Determine the after-tax cash flow at the time the forklift was sold. The firm’s tax rate is 45 percent.
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Related Book For
Managerial Accounting Creating Value in a Dynamic Business Environment
ISBN: 978-0078025662
10th edition
Authors: Ronald Hilton, David Platt
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