A piece of equipment bought for $50,000 at MKBK Systems is being depreciated using the Straight-Line method, a life of 5 years, and a salvage value of $5,000. At the end of four years, the management decided to sell the equipment for a modest price of $20,000. The company is in the 34% tax bracket. Compute the income tax that MKBK will owe on the sale of this equipment. Group of answer choices $6800 $3060 $2040 $5780
A piece of equipment bought for $50,000 at MKBK Systems is being depreciated using the Straight-Line method, a life of 5 years, and a salvage value of $5,000. At the end of four years, the management decided to sell the equipment for a modest price of $20,000. The company is in the 34% tax bracket. Compute the income tax that MKBK will owe on the sale of this equipment. Group of answer choices $6800 $3060 $2040 $5780
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
Related questions
Question
A piece of equipment bought for $50,000 at MKBK Systems is being depreciated using the Straight-Line method, a life of 5 years, and a salvage value of $5,000. At the end of four years, the management decided to sell the equipment for a modest price of $20,000. The company is in the 34% tax bracket. Compute the income tax that MKBK will owe on the sale of this equipment.
Group of answer choices
$6800
$3060
$2040
$5780
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