A company has just invested in a capital project. Suppose the company uses straight line...
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A company has just invested in a capital project. Suppose the company uses straight line depreciation for reported taxes and MACRS depreciation to determine actual tax payments. a The company will pay lower taxes than they report in early years of the project. b The company will generate a deferred tax liability in early years of the project. c The company will pay the same total taxes over the life of the project d All of the above are true e Only a and c are true. 
A company has just invested in a capital project. Suppose the company uses straight line depreciation for reported taxes and MACRS depreciation to determine actual tax payments.
a The company will pay lower taxes than they report in early years of the project.
b The company will generate a deferred tax liability in early years of the project.
c The company will pay the same total taxes over the life of the project
d All of the above are true
e Only a and c are true.
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