If the appropriate tax rate is 40%, the after-tax effect of a single depreciation deduction of $100,000 is a _____.

Name: If the appropriate tax rate is 40%, the after-tax effect of a single depreciation deduction of $100,000 is a _____.
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Question

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A depreciation deduction reduces taxable income, leading to a tax saving of 40% of the deduction amount. Therefore, a $100,000 deduction saves $40,000 in taxes, resulting in a net after-tax cash inflow of $40,000.

If the Appropriate Tax Rate Is 40%, the After-Tax Effect