In an equipment selection capital budgeting decision,which of the following will increase the present value of the tax savings from the annual depreciation deductions?

Question

Quizplus · Accepted Answer

An increase in the tax rate would result in a higher tax savings from the annual depreciation deductions, which would increase the present value of those savings. The cost of capital, salvage value, and cost of new equipment have no direct impact on the tax savings from depreciation.

In an Equipment Selection Capital Budgeting Decision,which of the Following