Liberty Services is now at the end of the final year of a project. The equipment was
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Question:
Liberty Services is now at the end of the final year of a project. The equipment was purchased prior to the new tax law and originally cost $ of which has been depreciated. The firm can sell the used equipment today for $ and its tax rate is What is the equipments aftertax salvage value for use in a capital budgeting analysis? Note that if the equipment's final market value is less than its book value, the firm will receive a tax credit as a result of the sale that will offset income from the companys other projects.
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