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To: Dan3 who wrote (55039)	9/25/2000 8:59:12 AM
From: Zeev Hed	Read Replies (2) \| Respond to of 93625

Dan: Re: "Paying the costs of setting up the new FAB before it was generating any income is one of the reasons AMD wasn't profitable last year - and has been minting money this year." That is not how accounting works, you cannot charge cap-ex to "expenses", you capitalize these and can charge depreciation on that asset only when the assets are put into service. Only a small portion of that expenditure (related to overhead, planning and design) can be charged against expenses. The IRS does not like you to deduct what they consider capital expenditure but at the rate they dictate. That is one of the reasons that MU's Lehi disaster has never hit their bottom line. Good luck out there. Zeev