Analyze the cash flow after taxes

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Suppose an asset has a first cost of $8,000. a life of five years, a salvage value of $2,000 at the end of five years, and a net annual before-tax revenue of $2, 500. The firm s marginal tax rate is 35%.

The asset will be depreciated by three-year MACRS. (a) Using the generalized cash flow approach, determine the cash flow after taxes.

Reference no: EM132003084

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