The Total Depreciation Tax Shield Equals the Product of Depreciation

question 64

True/False

The total depreciation tax shield equals the product of depreciation and the tax rate.

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Definitions:

Current Liabilities

Liabilities that will be due within a short time (usually one year or less) and that are to be paid out of current assets.

Current Assets

Assets expected to be converted into cash, sold, or consumed within one year or during the business's operating cycle, whichever is longer.

Current Assets

Assets that a company expects to convert into cash or use up within one year or the operating cycle, whichever is longer.

Current Asset

An asset that is expected to be converted into cash, sold, or consumed within one year or the operating cycle, whichever is longer.