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Salvage value and depreciation tax shield

  • 1.  Salvage value and depreciation tax shield

    Posted 03-30-2020 10:49 AM
    Hi everybody, 

    I have question regarding calculation of depreciation tax shield. As far as I remember salvage (residual value) is not subtracted when calculating the depreciation tax shield in capital budgeting regardless of  which depreciation method is used. But in investment decision tests 16th questions answer includes salvage value to calculation. 


    Thanks in advance.