Answered

Westonci.ca is the premier destination for reliable answers to your questions, brought to you by a community of experts. Our platform offers a seamless experience for finding reliable answers from a network of experienced professionals. Explore comprehensive solutions to your questions from a wide range of professionals on our user-friendly platform.

2. Your company has to liquidate some equipment that is being replaced. The original cost of the equipment is $100,000. The firm has deprecated 65% of the original cost. The salvage value of the equipment today is $50,000. The firm has a tax rate of 30%. What is the equipment’s after-tax net salvage value? Please show your work.

Sagot :

Answer: $45,500

Explanation:

Cost of equipment = $100,000

Less: Depreciation = 65% × $100,000 = $65,000

Book value = $35000

Less: Savage value = $50,000

Loss on sale = $15000

Less: Tax Payable = 30% × $15000 = $4500

After tax Savage value = $50000 - $4500 = $45,500

We hope our answers were helpful. Return anytime for more information and answers to any other questions you may have. We appreciate your visit. Our platform is always here to offer accurate and reliable answers. Return anytime. Get the answers you need at Westonci.ca. Stay informed with our latest expert advice.