Tax Expense Question

seth7384

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A firm purchased equipment for $6000.
Revenue will increase by $15000 per year.
life expectancy is 3 years and no salvage value.
tax rate is 30%
straight line depreciation.
Calculate the tax expense for year 1 and year 2.
Please let me know if I am reading the question wrong. I read it as: revenue for year 1 as $15000 and revenue for year 2 as $30000 ($15 000 increase).
In the answer, revenue is $15000 each year.
 
I think it says that the additional revenue will be $k15 p.a.
So additional net income will be 15-6/3=12 in each year increasing income tax expenses by $k 12 * 0.3 = $k 3.6 p.a.
 
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