Has this asset been correctly classified

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A manufacturer of fabricated metal products has acquired a new plasma table for $37,000. It is projected that the acquisition of this equipment will increase revenue by $10,000 per year. Operating costs for the machine will average $2,600 per year. The machine will be depreciated using the MACRS method, with a recovery period of 7 years. The company uses an after-tax MARR rate of 10% and has an effective tax rate of 30%.

1. Has this asset been correctly classified? Justify your answer (be specific). In subsequent parts, use the depreciation method and classification indicated above regardless of your conclusion.

Reference no: EM132038605

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