ARKO oil company purchased two large compressors for $125,000 each. One compressor was installed in the firm's

Question:

ARKO oil company purchased two large compressors for $125,000 each. One compressor was installed in the firm's Texas refinery and is being depreciated by MACRS depreciation. The other compressor was placed in the Oklahoma refinery, where it is being depreciated by sum-of-years' -digits depreciation with zero salvage value. Assume the company pays federal income taxes each year and the tax rate is Constant. The corporate accounting department noted that the two compressors are being depreciated differently and wonders whether the corporation will wind up paying more income taxes over the life of the equipment as a result of this. What do you tell them?

Depreciation
Depreciation is an important concept in accounting. By definition, depreciation is the wear and tear in the value of a noncurrent asset over its useful life. In simple words, depreciation is the cost of operating a noncurrent asset producing... Salvage Value
Salvage value is the estimated book value of an asset after depreciation is complete, based on what a company expects to receive in exchange for the asset at the end of its useful life. As such, an asset’s estimated salvage value is an important... Corporation
A Corporation is a legal form of business that is separate from its owner. In other words, a corporation is a business or organization formed by a group of people, and its right and liabilities separate from those of the individuals involved. It may...