Firm AAA is considering investing $15,000 for machinery for a project. The project will last...
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Firm AAA is considering investing $15,000 for machinery for a project. The project will last for 10 years. The company uses a straight-line depreciation on the machinery over the 10 years with annual depreciation of $1,200 per year. The machinery is expected to have a salvage value at the end of year 10 of $2,500 (i.e., may be sold for a market price of $2,500). Calculate the after-tax salvage value. Assume capital gain tax rate of 35%.
Group of answer choices a. $2,325 b. $2,675 c. $3,000 d. $1,625
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