Your Firm Needs a Computerized Machine Tool Lathe Which Costs

question 105

Multiple Choice

Your firm needs a computerized machine tool lathe which costs $50,000, requires $10,000 in installation and another $12,000 in maintenance for each year of its 3-year life. After 3 years, this machine will be replaced. The machine falls into the MACRS 3-year class life category. Assume a tax rate of 30% and a discount rate of 12%. If the lathe can be sold for $7,000 at the end of year 3, what is the after-tax salvage value?

• A) $6,233.80
• B) $6,311.90
• C) $5,927.20
• D) $6,154.20

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Definitions:

Guilt

A cognitive or an emotional experience that occurs when a person believes they have compromised their own standards of conduct or has violated a moral standard and bears significant responsibility for that violation.

Normal Response

A typical or expected reaction or behavior in response to a specific stimulus or situation.

Complicated Grief

A prolonged grieving process characterized by extreme difficulty in recovering from the loss of a loved one.

Psychotherapy

A treatment method involving psychological techniques, used to assist individuals in overcoming mental health problems or emotional issues.