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Npv add back dep or tax saving

Forums › Ask ACCA Tutor Forums › Ask the Tutor ACCA AFM Exams › Npv add back dep or tax saving

  • This topic has 2 replies, 3 voices, and was last updated 7 years ago by John Moffat.
Viewing 3 posts - 1 through 3 (of 3 total)
  • Author
    Posts
  • June 7, 2018 at 11:43 am #457443
    hamilton001
    Member
    • Topics: 2
    • Replies: 9
    • ☆

    Hi

    When do you add back dep and when you do a tax saving in the npv?

    Thanks

    June 7, 2018 at 4:40 pm #457544
    patrick
    Participant
    • Topics: 0
    • Replies: 6
    • ☆

    Meant CASs not VAs

    June 7, 2018 at 5:23 pm #457588
    John Moffat
    Keymaster
    • Topics: 57
    • Replies: 54682
    • ☆☆☆☆☆

    For Paper P4, you subtract the tax allowable depreciation to get the taxable profit, and then calculate the tax.

    The current examiner does not then add back the depreciation. The reason is that he always assumes (and usually states in the question) that amount equal to the depreciation is needed to be spent on replacing the non-current assets.

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  • The topic ‘Npv add back dep or tax saving’ is closed to new replies.

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