Limited access

Upgrade to access all content for this subject

You are trying to project the cash flows for a new truck your company is thinking of buying. The truck will cost \$50,000, and your company uses straight-line depreciation for book purposes but MACRS for tax. The truck has a depreciable life of 3 years under either method.

How much depreciation expense should you include in year one of your analysis?

Note: MACRS factors are 33%, 45%, 15%, and 7% for years 1-4.






Impossible to calculate, you need to know the salvage value.


Neither, depreciation doesn't matter for cash flows.

Select an assignment template