An old machine was purchased for $20,000, at a book value of $5,000, and sold for $9,000. - 4445

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Request Description

An old machine was purchased for $20,000, at a book value of $5,000, and sold for $9,000. The firm’s marginal tax rate is 25%. What is the amount of taxes due? 

a. $9000 

b. $5000 

c. $2250 

d. $1000 

 
Solution Description

An old machine was purchased for $20,000