Matiss posted a question Mar 30, 2013 at 4:35pm
PowerBuilt Construction is considering whether to replace an existing bulldozer with a new model. If the new bulldozer is purchased, the existing bulldozer will be sold to another company for $85,000. The existing bulldozer has a book value equal to $100,000. What will be the net after-tax cash flow that is generated from the disposal of the existing bulldozer? PowerBuilt's marginal tax rate is 35 percent.