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To: maui_dude who wrote (124306)1/5/2001 2:50:45 PM
From: The Duke of URLĀ©  Read Replies (2) | Respond to of 186894
 
Does that sound right ?

No. R&D is currently deductible dollars spent or credited out of current earnings. COGS is what it cost to make a part and agian is CURRENTLY deductible.

Cap ex is by definition, NOT DEDUCTIBLE from current earnings, has no effect on current earnings and doesn't have anything to do with current earnings. Once the plant is "placed in service or use" some YEARS from now, then it is depreciated, then the depreiation will effect earnings.

Howzzit Bro.



To: maui_dude who wrote (124306)1/5/2001 3:38:55 PM
From: L. Adam Latham  Respond to of 186894
 
maui_dude:

Duke of Earl is correct - these new assets would be depreciated over several (possibly many) years, so you would not see an immediate $2.5B increase in earnings.

Adam