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n 2013, Doha Trains purchased equipment for $544000. Doha Trains' accumulated book depreciation with respect to...

n 2013, Doha Trains purchased equipment for $544000. Doha Trains' accumulated book depreciation with respect to the equipment is $414000, and its accumulated tax depreciation(cost recovery) is $589000. Doha Trains' tax rate is 26%. what is the tax saving ?

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Answer #1

Tax Saving on Depreciation will be = ( Tax Depreciation - Book Depreciation) X Tax rate

= ( 589,000 - 414,000 ) X 26%

= 175,000 X 26%

= $ 45,500

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