How will depreciation affect PAT?

Answer Posted / santosh kalburgi

PAT is the result of the profit reduced by depreciation,
interest and then tax. The depreciation saves the company's
money in terms of tax shield on Depreciation. When the
company shows the depreciation the profit reduces to that
extent, and so when that remaining income is taxed, tax
amount to the extent of depreciation gets saved.

Is This Answer Correct ?    17 Yes 0 No



Post New Answer       View All Answers


Please Help Members By Posting Answers For Below Questions

If you get a better job in Public Sector (IAS/PCS Etc.), will you leave us?

651


How do you rate your communication skills - 1-10 scale?

653


Where do you see the Euro in 2018?

647


What details does the deposit register cover?

612


What is Basel II?

756






What do you know about insurance? Name some insurance agencies you know?

608


What is 'union excise duty'?

597


What Is Non-traditional Options?

630


What is m-commerce?

717


What are the leadership qualities you have?

649


How will you define the role of SEBI?

635


What are some of the roles of NABARD and IRDA?

729


discuss on limited liability.

686


What Is Interest Expense?

686


Have you faced any failure in life? If yes, how did you overcome it?

632