Question

Cost recovery. ​ Richardses' Tree​ Farm, Inc. purchased a new aerial tree trimmer for ​$94 comma 000. It is classified in the property class category of a​ single-purpose agricultural and horticultural structure. Then the company sold the tree trimmer after four years of service. If a​ seven-year life and​ MACRS, LOADING...​, was used for the depreciation​ schedule, what is the​ after-tax cash flow from the sale of the trimmer​ (use a 40​% tax​ rate) if a.  the sales price was ​$35 comma 000​? b.  the sales price was ​$29 comma 365.60​? c.  the sales price was ​$22 comma 000​? a.  If the sales price is ​$35 comma 000​, what is the​ after-tax cash​ flow?

Answer 1