Consider an asset that costs $666,000 and is depreciated straight-line to zero over its nine-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 $169,000. If the relevant tax rate is 30 percent, what is the aftertax cash flow from the sale of this asset? (Do not round intermediate calculations.) Aftertax salvage value eBook & Resources eBook: 10.4. More about Project Cash Flow Check my work

Cornerstones of Cost Management (Cornerstones Series)
4th Edition
ISBN:9781305970663
Author:Don R. Hansen, Maryanne M. Mowen
Publisher:Don R. Hansen, Maryanne M. Mowen
Chapter19: Capital Investment
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Problem 18E
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Consider an asset that costs $666,000 and is depreciated straight-line to zero over its nine-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 $169,000. If the
relevant tax rate is 30 percent, what is the aftertax cash flow from the sale of this asset? (Do not round
intermediate calculations.)
Aftertax salvage value
2$
eBook & Resources
eBook: 10.4. More about Project Cash FloW
Check my work
Transcribed Image Text:Consider an asset that costs $666,000 and is depreciated straight-line to zero over its nine-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 $169,000. If the relevant tax rate is 30 percent, what is the aftertax cash flow from the sale of this asset? (Do not round intermediate calculations.) Aftertax salvage value 2$ eBook & Resources eBook: 10.4. More about Project Cash FloW Check my work
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