Cowboy Company wishes to sell a machine with a book value of $40,000.The income tax rate is 30%.The machine is sold for $60,000.
Required:
A) What is the net after-tax cash flow from the sale of the machine? Is it an inflow or outflow?
B) If the machine is sold for $30,000, what is the net after-tax cash flow from the sale of the machine?
Correct Answer:
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