Tony Industries plan to sell a machine in the current tax year. The cost basis presented is RM500,000 and the accumulated depreciation is RM450,000. The effective income tax rate is 0.30. Determine: (i) the minimum sold price required of the machine to gain on the disposal and (ii) the revised minimum sold price required of the machine to gain on the disposal if the effective income tax rate adjusted to 0.50 while accumulated depreciation increased 10 %.
Tony Industries plan to sell a machine in the current tax year. The cost basis presented is RM500,000 and the accumulated depreciation is RM450,000. The effective income tax rate is 0.30. Determine: (i) the minimum sold price required of the machine to gain on the disposal and (ii) the revised minimum sold price required of the machine to gain on the disposal if the effective income tax rate adjusted to 0.50 while accumulated depreciation increased 10 %.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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