Question: Pear orchards is evaluating a new project that will require equipment of 249000. The equipment will be depreciated on a five year MACRS schedule. the

Pear orchards is evaluating a new project that will require equipment of 249000. The equipment will be depreciated on a five year MACRS schedule. the annual depreciation percentages are 20%, 32%, 19.20%, 11.52% and 11.52% respectively. The company plans to shut down project after 4 years. At that time the equipment could be sold for 67100. However the company plans to keep the equipment for a different project in another state. The tax rate is 40%. What aftertax salvage value should the company use when evaluating the current project?

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