Aftertax cash flow from sale of equipment


A 5 year project requires the initial purchase of a $245,000 machine. This machine has a 7-year life and will be depreciated straight-line to zero. At the end of the project, the equipment can be sold for $59,000. The tax rate is 34%. What is the aftertax cash flow from the sale of the equipment?

a. $38,940

b. $55,260

c. $57,740

d. $62,740

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Finance Basics: Aftertax cash flow from sale of equipment
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