After-tax operating cash flow does not change under straight line or MACRS accelerated depreciation?
My undstanding is
When you are using MACRS, you are charging higher depreciation in intial years, so you are paying less taxes. When you pay less tax than you have hight CFO and also you can invest that tax saving to somewhere and generate income.
For that same reason, we add depreciation tax shild to the operating cash flow: (S-C)(1-t)+ D*T
I faced this issue in CFA: Topic test-
Corporate Finance - Scott
problem number 5.
Please answer it.