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Hi turtor
In the answer model, residual value was 8.92M.
whether residual value need to consider taxation?The examiner has been rather inconsistent.
Sometime he treats it as though the asset has actually been sold, and therefore there is a balancing allowance or balancing charge. Other times he just has the normal writing down allowance, or ignores completely and assumes that the value given is after any tax effect.
If the question does not specify then just state your assumption and you will get the marks.
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