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You own some equipment which you purchased three years ago at a cost of $135,000. The...

You own some equipment which you purchased three years ago at a cost of $135,000. The equipment is 5-year property for MACRS. You are considering selling the equipment today for $82,500. Which one of the following statements is correct if your tax rate is 34%?

MACRS 5-year property

Year Rate

1 20.00%

2 32.00%

3 19.20%

4 11.52%

5 11.52%

6 5.76%

The tax due on the sale is $14,830.80

The book value today is $64,320.

The book value today is $8,478.

The taxable amount on the sale is $38,880.
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Answer #1
Cost of Equipment 135000
Accumulated depreciation 96120
(20+32+19.20)% of 135000
Book value of assets today 38880
Sales price 82500
Gain on sale 43620
Tax On sales 14830.8
Answer is The Tax due on sale is $ 14830.80
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