Homework Answers
Way Corporation Depriciation is calculated as below:
| Asset | Original Basis ($) | Rate | Portion of Year | Depreciation Expenses($) |
| Furniture | 105,000 | 8.93% | 50.00% | 4,689 |
| Machinery | 122,000 | 10.93% | 12.50% | 1,667 |
| Delivery Truck | 60,000 | 19.20% | 50.00% | 5,760 |
| Machinery | 322,000 | 27.55% | 62.50% | 55,445 |
| Computer | 120,000 | 0.00% | 50.00% | 0 |
Answer : Total Depreciation Expenses------------------------$67,561
Work Out:
As given in the question no depreciation of assests acquired and disposed of in the same year.
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Way Corporation disposed of the following tangible personal property assets in the current year. Asset Furniture...
Evergreen Corporation (calendar-year-end) acquired the following assets during the current year: (ignore §179 expense and bonus...
Evergreen Corporation (calendar-year-end) acquired the following assets during the current year: (ignore §179 expense and bonus depreciation for this problem): (Use MACRS Table 1 and Table 2.) Date Placed Original Asset in Service Basis Machinery October 25 $ 112,000 Computer equipment February 3 41,500 Used delivery truck* August 17 54,500 Furniture April 22 202,500 *The delivery truck is not a luxury automobile. b. What is the allowable MACRS depreciation on Evergreen’s property in the current year if Evergreen does not...
Convers Corporation (calendar-year-end) acquired the following assets during the current tax year: (ign...
Convers Corporation (calendar-year-end) acquired the following assets during the current tax year: (ignore $179 expense and bonus depreciation for this problem): (Use MACRS Table 1. Table 2 and Table 5) Asset Machinery Computer equipment Used delivery truck Furniture Total Date Placed in Service October 25 February 3 March 17 April 22 Original Basis $ 84,000 $ 24,000 $ 37,000 $164,000 $ 309,000 *The delivery truck is not a luxury automobile. In addition to these assets, Convers installed new flooring (qualified...
Assume that ACW Corporation has 2018 taxable income of $1,020,000 for purposes of computing the §179...
Assume that ACW Corporation has 2018 taxable income of $1,020,000 for purposes of computing the §179 expense. The company acquired the following assets during 2018 (assume no bonus depreciation): (Use MACRS Table 1, Table 2, and Table 5). Assume that the qualified improvement property has satisfied the conditions mentioned under Section 179(f)(2) Asset Placed in Service Basis Machinery Computer equipment Delivery truck Qualified improvement property Total 12-Sep 10-Feb 21-Aug 2-Apr $ 472,000 72,800 95,000 1,382,000 $2,021,000 a. What is the...
On May 12 of year 1, Javier purchased a building, including the land it was on,...
On May 12 of year 1, Javier purchased a building, including the land it was on, to assemble his new equipment. The total cost of the purchase was $1,495,000; $450,000 was allocated to the basis of the land and the remaining $1,045,000 was allocated to the basis of the building. (Use MACRS Table 1, Table 2, Table 3, Table 4 and Table 5.) (Do not round intermediate calculations. Round your answers to the nearest whole dollar amount.) C. Assume the...
Required information [The following information applies to the questions displayed below.] Lina purchased a new car...
Required information [The following information applies to the questions displayed below.] Lina purchased a new car for use in her business during 2019. The auto was the only business asset she purchased during the year and her business was extremely profitable. Calculate her maximum depreciation deductions (including §179 expense unless stated otherwise) for the automobile in 2019 and 2020 (Lina doesn’t want to take bonus depreciation for 2019 or 2020) in the following alternative scenarios (assuming half-year convention for all):...
Harris Corp. is a technology start-up in its second year of operations. The company didn’t purchase...
Harris Corp. is a technology start-up in its second year of
operations. The company didn’t purchase any assets this year but
purchased the following assets in the prior year:
Placed in
Asset
Service
Basis
Office equipment
August 14
$
12,000
Manufacturing equipment
April 15
88,000
Computer system
June 1
36,000
Total
$
136,000
Harris did not know depreciation was tax deductible until it
hired an accountant this year and didn’t claim any depreciation
deduction in its first year of operation....
. EXHIBIT 10-10 Automobile Depreciation Limits Year Placed in Service 2019* 2018 2017 2016 Recovery Year...
.
EXHIBIT 10-10 Automobile Depreciation
Limits
Year Placed in
Service
2019*
2018
2017
2016
Recovery Year 1
10,000**
10,000*
3,160*
3,160*
Recovery Year 2
16,000
16,000
5,100
5,100
Recovery Year 3
9,600
9,600
3,050
3,050
Recovery Year 4 and after
5,760
5,760
1,875
1,875
TABLE 2a MACRS Mid-Quarter Convention: For
property placed in service during the first quarter
Depreciation Rate for
Recovery Period
5-Year
7-Year
Year 1
35.00%
25.00%
Year 2
26.00
21.43
Year 3
15.60
15.31
Year 4
11.01...
Lina purchased a new car for use in her business during 2019. The auto was the...
Lina purchased a new car for use in her business during 2019. The auto was the only business asset she purchased during the year and her business was extremely profitable. Calculate her maximum depreciation deductions (including §179 expense unless stated otherwise) for the automobile in 2019 and 2020 (Lina doesn’t want to take bonus depreciation for 2019 or 2020) in the following alternative scenarios (assuming half-year convention for all): (Use MACRS Table 1, Table 2, and Exhibit 10-10.) a) The...
Lina purchased a new car for use in her business during 2019. The auto was the...
Lina purchased a new car for use in her business during 2019. The auto was the only business asset she purchased during the year and her business was extremely profitable. Calculate her maximum depreciation deductions (including §179 expense unless stated otherwise) for the automobile in 2019 and 2020 (Lina doesn’t want to take bonus depreciation for 2019 or 2020) in the following alternative scenarios (assuming half-year convention for all): (Use MACRS Table 1, Table 2, and Exhibit 10-10.) Table 1...
Erwin Company, a calendar year taxpayer, made only two purchases of depreciable personalty this year. The first purchase...
Erwin Company, a calendar year taxpayer, made only two purchases
of depreciable personalty this year. The first purchase was
five-year recovery property costing $312,800, and the second
purchase was seven-year recovery property costing $574,000. Use
Table 7-2 and Appendix 7-A.
Compute Erwin’s first-year MACRS depreciation with respect to
the personalty assuming that the first purchase occurred on
February 2, and the second purchase occurred on June 18.
Compute Erwin’s first-year MACRS depreciation with respect to
the personalty assuming that the...
Convers Corporation (calendar-year-end) acquired the following assets during the current tax year: (ignore $179 expense and bonus depreciation for this problem): (Use MACRS Table 1. Table 2 and Table 5) Asset Machinery Computer equipment Used delivery truck Furniture Total Date Placed in Service October 25 February 3 March 17 April 22 Original Basis $ 84,000 $ 24,000 $ 37,000 $164,000 $ 309,000 *The delivery truck is not a luxury automobile. In addition to these assets, Convers installed new flooring (qualified...
Assume that ACW Corporation has 2018 taxable income of $1,020,000 for purposes of computing the §179 expense. The company acquired the following assets during 2018 (assume no bonus depreciation): (Use MACRS Table 1, Table 2, and Table 5). Assume that the qualified improvement property has satisfied the conditions mentioned under Section 179(f)(2) Asset Placed in Service Basis Machinery Computer equipment Delivery truck Qualified improvement property Total 12-Sep 10-Feb 21-Aug 2-Apr $ 472,000 72,800 95,000 1,382,000 $2,021,000 a. What is the...
On May 12 of year 1, Javier purchased a building, including the land it was on, to assemble his new equipment. The total cost of the purchase was $1,495,000; $450,000 was allocated to the basis of the land and the remaining $1,045,000 was allocated to the basis of the building. (Use MACRS Table 1, Table 2, Table 3, Table 4 and Table 5.) (Do not round intermediate calculations. Round your answers to the nearest whole dollar amount.) C. Assume the...
Harris Corp. is a technology start-up in its second year of
operations. The company didn’t purchase any assets this year but
purchased the following assets in the prior year:
Placed in
Asset
Service
Basis
Office equipment
August 14
$
12,000
Manufacturing equipment
April 15
88,000
Computer system
June 1
36,000
Total
$
136,000
Harris did not know depreciation was tax deductible until it
hired an accountant this year and didn’t claim any depreciation
deduction in its first year of operation....
.
EXHIBIT 10-10 Automobile Depreciation
Limits
Year Placed in
Service
2019*
2018
2017
2016
Recovery Year 1
10,000**
10,000*
3,160*
3,160*
Recovery Year 2
16,000
16,000
5,100
5,100
Recovery Year 3
9,600
9,600
3,050
3,050
Recovery Year 4 and after
5,760
5,760
1,875
1,875
TABLE 2a MACRS Mid-Quarter Convention: For
property placed in service during the first quarter
Depreciation Rate for
Recovery Period
5-Year
7-Year
Year 1
35.00%
25.00%
Year 2
26.00
21.43
Year 3
15.60
15.31
Year 4
11.01...
Erwin Company, a calendar year taxpayer, made only two purchases
of depreciable personalty this year. The first purchase was
five-year recovery property costing $312,800, and the second
purchase was seven-year recovery property costing $574,000. Use
Table 7-2 and Appendix 7-A.
Compute Erwin’s first-year MACRS depreciation with respect to
the personalty assuming that the first purchase occurred on
February 2, and the second purchase occurred on June 18.
Compute Erwin’s first-year MACRS depreciation with respect to
the personalty assuming that the...
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