What is the after tax cash flow from the sale of this asset

Assignment Help Financial Management

Reference no: EM13880767

Consider an asset that costs $600,000 and is depreciated straight-line to zero over its eight-year tax life. The asset is to be used in a five-year project; at the end of the project, the asset can be sold for $170,000. If the relevant tax rate is 35 percent, what is the after tax cash flow from the sale of this asset?

After tax salvage value?

Reference no: EM13880767

Questions Cloud

What will be each of these balance sheet entries : A firm’s balance sheet has the following entries: Cash $30,000,000 Total assets 100,000,000 Common stock (10,000,000 20,000,000 Shares outstanding $2 par) Paid-in capital 5,000,000 Retained earnings 35,000,000 What will be each of these balance sheet..

How many taxis would serve the market : Suppose that, instead of limiting medallions, the commission charges a license fee to anyone wishing to drive a cab. With an average price of P = $10, what is the maximum fee the commission could charge? How many taxis would serve the market?

Statements about the foreign corrupt practices act : Which of the following statements about the Foreign Corrupt Practices Act of 1977 is correct

How purchase of apple press might affect revenue goal : What growth rate will be implied if revenue is to grow from the 2012 forecasted level to $25 million in 2015 and what is the average growth rate per year over the period 2012 to 2015 - Explain how purchase of the apple press might affect the compan..

What is the after tax cash flow from the sale of this asset : Consider an asset that costs $600,000 and is depreciated straight-line to zero over its eight-year tax life. The asset is to be used in a five-year project; at the end of the project, the asset can be sold for $170,000. If the relevant tax rate is 35..

What is opec optimal level of production : Suppose that, over the short run (say, the next five years), demand for OPEC oil is given by Q = 57.5 - .5P or, equivalently, P = 115 - 2Q. (Here Q is measured in millions of barrels per day.) OPEC's marginal cost per barrel is $15- What is OPE..

What are the appropriate abc groups of inventory items : What are the appropriate ABC groups of inventory items? If demand for an item is 3 units per day, and delivery lead-time is 15 days, what should we use for a simple re-order point?

What is the present value of this cash flow pattern : You have been offered the opportunity to invest in a project that will pay $5958 per year at the end of years one through three and $10986 per year at the end of years four and five. If the appropriate discount rate is 7.11 percent per year, what is ..

Determine the percent increase in the rate : The addition of aluminum fins has been suggested to increase the rate of heat dissipation from one side of an electronic device 1 m wide and 1 m tall. The fins are to be rectangular in cross section, 2.5 cm long and 0.25 cm thick.

User Account

All Pages