What is the after-tax salvage value of the machine

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Your firm is analyzing a project. A new machine must be purchased which will be sold in 5 years when the project ends. The salvage value of the machine is expected to be $8,000 at that time. The machine costs $22,000 today and the book value in year 5 is expected to be $10,000. What is the after-tax salvage value of the machine? Assume a corporate tax rate of 40%. Please show work.

Reference no: EM13883462

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