A fixed asset purchased for $22,507 at the beginning of a project will be depreciated straight-line...

 

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A fixed asset purchased for $22,507 at the beginning of a project will be depreciated straight-line to zero over its 9-year tax life. At the end of this project, the asset can be sold for $8464. The marginal tax rate is 29%. What amount of after-tax salvage value should be included in the incremental cash flows at the end of this 5-year project? A fixed asset purchased for $22,507 at the beginning of a project will be depreciated straight-line to zero over its 9-year tax life. At the end of this project, the asset can be sold for $8464. The marginal tax rate is 29%. What amount of after-tax salvage value should be included in the incremental cash flows at the end of this 5-year project?

Answer rating: 100% (QA)

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