An annual report for Federal Express Corporation included the following information: For financial reporting purposes, depreciation of

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An annual report for Federal Express Corporation included the following information:

For financial reporting purposes, depreciation of property and equipment is provided on a straight-line basis over the asset's service life. For income tax purposes, depreciation is generally computed using accelerated methods.

Required:

Explain why Federal Express uses different methods of depreciation for financial reporting and tax purposes.

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Financial Accounting

ISBN: 9780070001497

4th Canadian Edition

Authors: Patricia A. Libby, Daniel Short, George Kanaan, Maureen Libby Gowing, Robert Libby

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