Question : A $125,000 tractor-trailer being depreciated by the SL method over : 1273
A $125,000 tractor-trailer is being depreciated by the SL method over five years to a final BV of zero. Half-year convention does not apply to this asset. After three years, the rig is sold for $70,000 or $20,000. If the effective income tax rate is 40%, what is the net cash inflow from the sale for situation (a) and situation (b)?