About the after-tax salvage value

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Your firm needs a machine which costs $140,000, and requires $29,000 in maintenance for each year of its 5-year life. After 3 years, this machine will be replaced. The machine falls into the MACRS 5-year class life category. Assume a tax rate of 30% and a discount rate of 12%. If this machine can be sold for $14,000 at the end of year 5, what is the after-tax salvage value?

Reference no: EM13947638

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