> When Microsoft buys an Nvidia GPU for $100, it will claim that it lasts 5 years, so writes down $20 in the expense column for this year. Meanwhile Nvidia takes all the profit at time of sale, $100
Nvidia would log $64 of profit against a $100 sale [1]. (The R&D cost to develop the chip have already been booked.)
> for each GPU bought, SP500 logs $80 of profit, even though no money entered or left the SP500
In your example the S&P would log ~$40 of earnings. (About because taxes.)
Nvidia would log $64 of profit against a $100 sale [1]. (The R&D cost to develop the chip have already been booked.)
> for each GPU bought, SP500 logs $80 of profit, even though no money entered or left the SP500
In your example the S&P would log ~$40 of earnings. (About because taxes.)
[1] https://www.macrotrends.net/stocks/charts/NVDA/nvidia/profit...