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.
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.