Marshall-Miller & Company Is Considering the Purchase of a New

Multiple Choice

Marshall-Miller & Company is considering the purchase of a new machine for $50,000, installed. The machine has a tax life of 5 years, and it can be depreciated according to the following rates. The firm expects to operate the machine for 4 years and then to sell it for $12,500. If the marginal tax rate is 40%, what will the after-tax salvage value be when the machine is sold at the end of Year 4?

A) $8,878
B) $9,345
C) $9,837
D) $10,355
E) $10,900