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Business, 07.06.2020 02:03 aavil5659

Englehard purchases a slurry-based separator for the mining of clay that costs $700,000 and has an estimated usefullife of 10 years, a MACRS-GDS property class of 7 years, and an estimated salvage value of $75,000 after 10 years. It was financed using a $200,000 down payment and a loan of $500,000 over a period of 5 years with interest at10 percent. Loan payments are made in equal annual amounts (principal plus interest) over the 5 years. a. What is the amount of the MACRS-GDS depreciation taken in the third year?
b. What is the book value at the end of the third year?
c. Returning to the original situation, what is the amount of the MACRS-GDS depreciation taken in the third yearif the separator is also sold during the third year?

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