AMD has recorded straight-line depreciation on a machine for 5 years that it purchased 5 years ago for $218,000. The expected salvage value of the machine is $18,000 at the end of its estimated useful life of 10 years. The tax rate for BBB is 35%
1. Compute the annual depreciation expense under the straight-line depreciation method. 2. Compute the current cumulative depreciation expenses of the machine.
3. Compute the current net book value of the machine. 4. BBB decides to dispose the machine at the end of 8th year. Compute the tax credit/loss from the sale of the machine if the sales price is:
$68,000:
$48,000: