Hercules Exercise Equipment Co, purchased a computerized measuring device two years ago for $88,000. The equlpment falls into the five-year category for MACRS depreciation and can currently be sold for $39,800. A new plece of equipment will cost $155,000. It also falls into the five-year category for MACRS depreciation. Assume the new equipment would provide the following stream of added cost savings for the next six years. Use Table 12-12. Use ARRendix. B for an approximate answer but calculate your final answer using the formula and financial calculator methods. The firm's tax rate is 25 percent and the cost of capital is 12 percent. a. What is the book value of the old equipment? (Do not round intermediate calculations and round your answer to the nearest whole dollar.) b. What is the tax loss on the sale of the old equipment? (Do not round intermediate calculations and round your answer to the nearest whole dollar.) c. What is the tax benefit from the sale? (Do not round intermedlate calculations and round your answer to the nearest whole dollar.) d. What is the cash inflow from the sale of the old equipment? (Do not round intermediate calculations and round your answer to the nearest whole dollar.) calcutasiont and revind pore ankwer lo the neareat whole dolart L. Compute the aftertax benefits of the cont iavingh. (Enter the ahertax fector as a declmal revinded to 2 decimal places. Alourd al other enswets to the nearest whole dollae] H. Add the depreciation tax stield benefits and the aherts cost sovengs to deterinine the bodal moual becefts. (Do net rewnd intermediate caleulationa and reund youd antwern to the neareit whole dollet) nearest wheie deilec) k-2. Should the replacement be undertaken? Yes No Hercules Exercise Equipment Co, purchased a computerized measuring device two years ago for $88,000. The equlpment falls into the five-year category for MACRS depreciation and can currently be sold for $39,800. A new plece of equipment will cost $155,000. It also falls into the five-year category for MACRS depreciation. Assume the new equipment would provide the following stream of added cost savings for the next six years. Use Table 12-12. Use ARRendix. B for an approximate answer but calculate your final answer using the formula and financial calculator methods. The firm's tax rate is 25 percent and the cost of capital is 12 percent. a. What is the book value of the old equipment? (Do not round intermediate calculations and round your answer to the nearest whole dollar.) b. What is the tax loss on the sale of the old equipment? (Do not round intermediate calculations and round your answer to the nearest whole dollar.) c. What is the tax benefit from the sale? (Do not round intermedlate calculations and round your answer to the nearest whole dollar.) d. What is the cash inflow from the sale of the old equipment? (Do not round intermediate calculations and round your answer to the nearest whole dollar.) calcutasiont and revind pore ankwer lo the neareat whole dolart L. Compute the aftertax benefits of the cont iavingh. (Enter the ahertax fector as a declmal revinded to 2 decimal places. Alourd al other enswets to the nearest whole dollae] H. Add the depreciation tax stield benefits and the aherts cost sovengs to deterinine the bodal moual becefts. (Do net rewnd intermediate caleulationa and reund youd antwern to the neareit whole dollet) nearest wheie deilec) k-2. Should the replacement be undertaken? Yes No