A $ 9 5 , 0 0 0 machine with a 1 0 - year class life

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Question:

A $

95, 000

machine with a

10 -

year class life was purchased

5

years ago. The machine will now be sold for $

34, 000

and replaced with a new machine costing $

59, 000,

with a

5 -

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

16, 000

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

34

percent. What is the initial outlay for the project? NOTE

- -

ALTHOUGH THE INITIAL OUTLAY IS NEGATIVE, PLEASE ENTER YOUR ANSWER AS A POSITIVE SIGN

Posted Date: May 19, 2024 02:05 AM

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A $ 9 5 , 0 0 0 machine with a 1 0 - year class life

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