What is the initial after-tax outlay for the new machine

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Reference no: EM132023166

The Target Copy Company is contemplating the replacement of its old printing machine with a new model costing R60.000. The old machine, which originally cost R40.000 has 6 years of expected life remaining and a current book value of R30.000 versus a current market value of R24.000. Target's corporate tax rate is 40%.

If Target sells the old machine at market value, what is the initial after-tax outlay for the new printing machine?

Reference no: EM132023166

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