You own some equipment that you purchased 4 years ago at a cost of $216,000. The

Question

You own some equipment that you purchased 4 years ago at a cost of $216,000. The equipment is 5 year property for MACRS. You are considering selling the equipment today for $75,500. Which one of the following statements is correct if your tax rate is 35%? Year Rate 1 20.00% 2 32.00% 3 19.20% 4 11.52% 5 11.52% 6 5.76% A. The tax due on the sale is $26,425 B. The book value today is $178,675.20 C. The accumulated depreciation to date is $37,324.80 D. The taxable amount on the sale is $37,324.80 E. The aftertax salvage value is $62,138.68

Explanation / Answer

D. The taxable amount on the sale is $37,324.80

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