Suppose That Under the Tax Cuts and Jobs Act a Firm

Suppose that under the Tax Cuts and Jobs Act a firm that invests in equipment can immediately deduct the full cost of that equipment or it can depreciate the equipment under the MACRS system.For tax purposes the firm should ________.

A) use the MACRS system because doing so better matches the firms costs to its revenues
B) use the MACRS system because the firm will report higher profits in the year the equipment is purchased than it would report if it fully expensed the cost of the asset
C) deduct the full cost of the asset immediately because doing so reduces taxes and increases cash flow
D) deduct the full cost of the asset immediately because profits in years after the equipment is purchased will be higher