Intermediate Financial Management (MindTap Course List)
Intermediate Financial Management (MindTap Course List)
13th Edition
ISBN: 9781337395083
Author: Eugene F. Brigham, Phillip R. Daves
Publisher: Cengage Learning
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Financial Accounting

Suppose you sell a fixed asset for $180,000 when its book value is
$200,000. If your company's marginal tax rate is 30%, what will be
the effect on the cash flows of this sale (i.e., what will be the after-tax
cash flow of this sale)?
A) $186,000
B) $150,000
C) $170,000
D) $140,000
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Transcribed Image Text:Suppose you sell a fixed asset for $180,000 when its book value is $200,000. If your company's marginal tax rate is 30%, what will be the effect on the cash flows of this sale (i.e., what will be the after-tax cash flow of this sale)? A) $186,000 B) $150,000 C) $170,000 D) $140,000
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