2. Company As non-current assets have a residual value of zero, a beginning book value of 5,000, and an initial cost of 10,000. Company A uses an annual depreciation percentage of 10%. Its statutory (and effective) tax rate is 30 percent. What adjustments would an analyst make to company As current years tax expense if she assumes that company As depreciation percentage should be 12%?

• A.Decrease tax expense by 60
• B.Increase tax expense by 60
• C.Decrease tax expense by 30
• D.Increase tax expense by 30
• E.No adjustment