Josephine Company, a sole proprietorship whose owner is in the 35 percent marginal tax bracket, purchases five-year MACRS property in mid-year for $12,000. What is its after-tax cost of this asset if it uses a 6 percent discount rate for project evaluation? No Section 179 expensing or bonus depreciation is claimed for this property.

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The Answer of Josephine Company, a sole proprietorship whose owner is in the 35 percent marginal tax bracket, purchases five-year MACRS property in mid-year for $12,000. What is its after-tax cost of this asset if it uses a 6 percent discount rate for project evaluation? No Section 179 expensing or bonus depreciation is claimed for this property.

Josephine Company, a Sole Proprietorship Whose Owner Is in the 35