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Monday, August 31, 2015

A machine was purchased two years ago for $120,000 and can be sold for $50,000 today

A machine was purchased two years ago for $120,000 and can be sold for $50,000 today. The machine has been depreciated using the MACRS 5-year recovery period and the firm pays 40 percent taxes on both ordinary income and capital gains. Find the firm's tax liability (benefit), if any.


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