Question

U-10 S alt st Depreciation Afirm is evaluating the acquisition of an asset that costs $66,300 and requires $4.350 in installation costs. If the firm depreciates the asset under MACRS, using a 5-year recovery period (see table ). determine the depreciation charge for each year. The annual depreciation expense for year 1 will be $ (Round to the nearest dollar.) Data Table Click on the icon located on the top-right corner of the data table below in order to copy its contents into a spreadsheet Rounded Depreciation Percentages by Recovery Year Using MACRS for First Four Property Classes Percentage by recovery year Recovery year 5 years 3 years years 10 years 20% 329 1896 1996 1200 1296 1030 1996 1216 996 870 66 49 6% Enter your answer in the answer box and then click Ched 493 10050 1 00 100 Darts "These percentages have been rounded to the nearest whole percent to simpty calculations w e retaining realism. To calculate the actual depreciation for tax purposes be sure to apply the actual Copyright © 2019 Pearson Education Inc. All rights reserved. Terms of Use | B Y S PEE C H

Answer 1

Cost of Machine	$      66,300
Installation cost	$         4,350
Total depreciable value	$      70,650
Year	Depreciable value	Depreciation rate	Depreciation-Depreciable value * Depreciation rate
1	$      70,650	20%	$                       14,130
2	$      70,650	32%	$                       22,608
3	$      70,650	19%	$                       13,424
4	$      70,650	12%	$                          8,478
5	$      70,650	12%	$                          8,478
6	$      70,650	5%	$                          3,533