The Jones Company has just completed the third year of a five-year MACRS recovery period...
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Accounting
The Jones Company has just completed the third year of a fiveyear MACRS recovery period for a piece of equipment it originally purchased for $
a What is the book value of the equipment?
b If Jones sells the equipment today for $ and its tax rate is what is the aftertax cash flow from selling it
c Just before it is about to sell the equipment, Jones receives a new order. It can take the new order if it keeps the old equipment. Is there a cost to taking the order and if so what is it Explain.
Note: Assume that the equipment is put into use in year and the new order will consume the remainder of the machine's useful life.
a What is the book value of the equipment?
The book value of the equipment after the third year is $
Round to the nearest dollar.
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