Ans:
Calculation of Book Tax Difference :
Tax Depreciation :
Section 179 Depreciation : $20,000
Bonus Depreciation : $40,000
Normal Depreciation : $15,000
Total Tax Depreciation : $20,000 + $40,000 + $15,000 = $75,000
Book Value of assets : $100,000
Depreciation for 1 year using SLM method : $100,000 / 5 = $20,000
Book Tax Difference : $75,000 - $20,000 = $55,000
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