Fm capital budgetting
Dikshant (student) (43 Points)
20 February 2014
why to treat tax shield as cash Inflow ??
when n how we have to treat it??
Ms. Sia Raman
(Chartered Accountant- Working Professional)
(198 Points)
Replied 20 February 2014
Depreciation is a non-cash expense. However, it is included as an allowable expense for Income Tax purpose. Due to this expense, the total tax outlay decreases to the extent of the Tax rate on depreciation allowed.
I couldn't understand the second part of your question clearly.
Dikshant
(student)
(43 Points)
Replied 20 February 2014
CAclubindia
