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What is the after tax salvage value of the old equipment

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Royal Dutch Petro (RDP) is considering a new equipment purchase that would replace some existing equipment. The old equipment has a Book Value (BV) of $367 thousand and RDP estimates that the equipment could be sold for ONLY $240 thousand.

Question 1: What is the After Tax Salvage Value (ATSV) of the old equipment that RDP should use in their capital budgeting analysis? Assume the tax rate = T= 35%. Answer to 2 decimal points, in units of thousands, thus 15,123 would be 15.12 .

Reference no: EM132472337

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