Question: Owens Grubbs and Riley LLP recently purchased a new facility

Owens, Grubbs, and Riley, LLP, recently purchased a new facility to house their law practice. The facility cost $500,000. The partnership will depreciate the facility by recording $50,000 of depreciation expense each year for 10 years. Owens, Grubbs, and Riley, LLP, expects that its tax rate will be 35 percent in the coming year.
Required:
What is the tax savings (i.e., the depreciation tax shield) associated with the new facility in the coming year?


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  • CreatedJuly 15, 2015
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