Question

I got this from last post

1. For reducing tax allowable depreciation ( TAD ) method for example

Plant cost 3 million
Reducing balance method 25%
Tax rate 30%

For first year when we calculate TAD, ITS 3million x 0.25 x 0.3

However for straight line basis
(Same example as above and 3 years)

Shouldnt it be 3million / 3 years x 0.3 ?

I do not understand why tax amount is not multiplied in the fubuki co question after dividing into number of years.

Because in TAMPEM reducing balance method, they did multiply with tax rate.
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Ito answer your questions, i have got all this figures as an example not from the question and i mentioned the question name for you to see which question i am asking

And you have stated
“The TAD has been subtracted to get the taxable profit and the tax calculated on that, which is one of the two approaches to dealing with the TAD (both of which obviously give the same answer)”

I think you have misunderstood my question.

1. My question was why we did not multiply the tax rate after we divided the number of years( like reducing balance method) ?

650 from the answer was 3000-400/4yrs

Since you said both would give the same answer

Then if 650 x tax rate, the tax profit would obviously be different

Im not sure how both answers can be same answer ?

You mean we can either use 650 or 650 x tax rate ?

Moreover i did watched your video lecturers but there were some parts i could not understand and i wasnt from finance or accounting major.

I will watch all the video lectures again before next week so i am fully prepared for the exam

2. You have mentioned that centrally allocated overhead Are never included and and total cost for the firm will not change and so there is no extra cashflow.

I still have difficulty understanding that part.

Why centrally allocated overhead is not included as the total cost for the firm ??

Its been really long time ago i have seen your lecturers and i will make sure i will watch video lecturers again john