What is the capital gain and before and after-tax cash flow


A property is sold for $1,000,000 with selling costs of 5% of the sales price. The mortgage balance at the time of sale is $560,000. The property was purchased 5 years ago for $800,000. Annual depreciation allowances of $19,500 have been taken. If the price appreciation and the depreciation recapture tax rates are 15% and 25%, respectively, what is the capital gain and before and after-tax cash flow from sale of the property at the end of the 5th year?

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Financial Management: What is the capital gain and before and after-tax cash flow
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