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Business, 13.05.2021 22:10 maybeemmamay

Your company is contemplating the purchase of a large stamping machine. The machine will cost ​$. With additional transportation and installation costs of ​$ and ​$​, ​respectively, the cost basis for depreciation purposes is ​$. Its MV at the end of five years is estimated as ​$. The IRS has assured you that this machine will fall under a three year MACRS class life category. The justifications for this machine include ​$ savings per year in labor and ​$ savings per year in reduced materials. The​ before-tax MARR is ​% per​ year, and the effective income tax rate is ​%. Assume the stamping machine will be used for only three​ years, owing to the​ company's losing several government contracts. The MV at the end of year three is ​$. What is the income tax owed at the end of year three owing to depreciation recapture​ (capital gain)?

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