Your firm needs a computerized machine tool lathe which


Your firm needs a computerized machine tool lathe which costs $59,000 and requires $12,900 in maintenance for each year of its 3-year life. After three years, this machine will be replaced. The machine falls into the MACRS 3-year class life category. Assume a tax rate of 34 percent and a discount rate of 12 percent. If the lathe can be sold for $5,900 at the end of year 3, what is the after-tax salvage value?

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Financial Management: Your firm needs a computerized machine tool lathe which
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