Engineering Economy 7th Edition by Leland Blank ,Anthony Tarquin

Exercise 12

When accelerated depreciation methods or shortened recovery periods are applied, there are impacts on the income taxes due. Of the following, the statements that are commonly incorrect are: 1. Total taxes paid are the same for all depreciation methods.
2. Present worth of taxes is lower for shorter recovery periods.
3. Accelerated depreciation imposes more taxes in the later years of the recovery period.
4. Present worth of taxes is higher for shorter recovery periods.
A) 1, 2, and 3
B) 1 and 4
C) 2
D) 4