Question

i dont understand this at all what is MACRS

Problem 3.6 Max Metal Inc. uses the same type of production line in the US and Malaysia plants. The first cost was $800,000 with a salvage value of $180,000 at the end of year 8. MACRS depreciation with n=5 years is applied in the US and standard SL depreciation with n=8 years is used by the Malaysian facility. (30 points) a. If the equipment is sold after 6 years for $180,000, calculate the over or under depreciation amounts for each method. (10*2 points) b. Use a spreadsheet to plot the book values for both methods on a single graph. (10 points)

Answer 1

The modified accelerated cost recovery system (MACRS) is a depreciation system used for tax purposes in the U.S. MACRS depreciation allows the capitalized cost of an asset to be recovered over a specified period via annual deductions. The MACRS system puts fixed assets into classes that have set depreciation periods

The modified accelerated cost recovery system (MACRS) is the correct depreciation strategy for generally resources. MACRS takes into consideration more prominent quickened depreciation over longer time frames. This is gainful since quicker speeding up enables people and organizations to deduct more prominent sums during the initial not many long periods of a benefit's life, and moderately less later. Depreciation utilizing MACRS can be applied to resources, for example, PC gear, office furniture, autos, wall, ranch structures, racehorses, etc.