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A company has a 30% tax rate. It buys a capital asset that will be depreciated for book purposes straight-line over 5 years. For tax
A company has a 30% tax rate. It buys a capital asset that will be depreciated for book purposes straight-line over 5 years. For tax purposes, this asset will be depreciated over 7 years. The company will book a deferred future tax liability in the early years of the asset generating positive cash flows.- is this true
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