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Calculate the terminal cash flow from the project

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Reference no: EM132939839

Problem 1: CGS Company installed a new machine 5 years ago. At the time the machine was installed, the salvage value was estimated at $1,500. The machine has been fully depreciated using the straight-line method with a salvage value. CGS sold the machine at the end of the 5-year project for $4,000 cash. CGS is subject to a 25% tax rate. Calculate the terminal cash flow from the project.

Option 1: $3,375

Option 2: $1,500

Option 3: $3,000

Option 4: $2,500

Reference no: EM132939839

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