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Business
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| Number of pages / Number of words: |
4 / 1085 |
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Doing so will allow you to reap some benefit of tax reduction. If capitalizing is the path chosen, the depreciation of all the cost capitalized to the machinery, will lower net income significantly.
b) All of these costs can be capitalized because they are all part of cost installment of the machine as stated in the text...
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However, they may want to expense as much as possible for tax purposes as mentioned in a).
c) Cost of sales tax on purchasing the machine can be capitalized, because costs of machinery includes the purchase price, sales tax, transportation costs to where the machinery is to be used, and installation costs...
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