Matshall-Miller & Company is considering the purchase of a new machine for $50,000, installed. The machine has a taxi life of five years, and can be depreciated according to the following rates. The firm expects to operate the machine for four years and then sell it for $12,500. If the marginal tax rate is 40%, what will the after-tax salvage value be when the machine is sold at the end of year for?
Year. 1. 2. 3. 4. 5. 6
Depreciation rate. 0.2 0.32 0.19 0.12 0.11 0.06