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What is the after tax cash flow

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Reference no: EM133111992

Suppose it installed its previous generation of computer chip manufacturing equipment 3 years ago. Some of that older equipment will become unnecessary when the company goes into production of its new product. The obsolete equipment, which originally cost $40 million, has been depreciated straight-line over an assumed tax life of 5 years, but it can now be sold for $18 million. The firm's tax rate is 35%. What is the after tax cash flow?

Reference no: EM133111992

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