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Technology Stocks : Advanced Micro Devices - Moderated (AMD) -- Ignore unavailable to you. Want to Upgrade?

To: wanna_bmw who wrote (76148)	4/2/2002 6:01:41 AM
From: Bill Jackson	Read Replies (1) \| Respond to of 275872

wanna, Yes, they both conform to the same rules. use depreciation to save taxes with a max rate per year that varies with equipment. Intel has more of it and with the lower profits it had will take extra years to use it up, as will AMD. Bill

To: wanna_bmw who wrote (76148)	4/2/2002 7:27:03 AM
From: hmaly	Respond to of 275872

BMW Re...? Since I clearly showed my misunderstanding of the subject, maybe you can explain to me what I'm missing.<<<<<<<<<< I think what Bill is trying to say is that all equipment can be written off over a certain time frame, determined by the IRS and manufacturers. It can be 0 ,5 or 10 ys. O would be for tools expected to last less than a yr., 5yrs for tools <1yr> 10 yrs and long lasting tools. Within that context, depreciation can be written off in several ways, straight line, or accelerated depreciation (which accelerates depreciation proportionally, I don't remember the formula), and possibly one or two extra formulas. At time of purchase the manufacturer picks the time frame and type of depreciation used. A company like Intel with expected poor profits for several yrs, might want to save depreciation for better yrs, to lower tax rates. AMD with on av. poorer prospects, would want to take the write off as fast as possible.