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Alik [6]
3 years ago
6

l a fixed asset for $72,376 when its book value is $43,070. If your company's marginal tax rate is 25 percent, what will be the

after-tax cash flow of this sale?
Business
1 answer:
tiny-mole [99]3 years ago
4 0

Answer:

Cash flow= $64,847

Explanation:

Giving the following information:

Sellin price= $72,376

Tax rate= 25%

Book value= $43,070

<u>First, we need to calculate the gain from the sale and the tax:</u>

Gain= 72,376 - 43,070= $29,036

Tax= gain*tax rate

Tax= 29,036*0.25= $7,259

<u>Now, we can calculate the after-tax cash flow:</u>

<u></u>

Gain= 29,036

Tax= (7,259)

Book value= 43,070

Cash flow= $64,847

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