Question

Required information (The following information applies to the questions displayed below.) AMP Corporation (calendar-year-end) has 2019 taxable income of $1,900,000 for purposes of computing the $179 expense. During 2019, AMP acquired the following assets: (Use MACRS Table 1, Table 2. Table 3, Table 4 and Table 5.) Asset Machinery Computer equipment Office building Total Placed in Service Basis September 12 $1,550,000 February 10 365,000 April 2 480,000 $2,395,000 b. What is the maximum total depreciation, including $179 expense, that AMP may deduct in 2019 on the assets it placed in service in 2019, assuming no bonus depreciation? (Round your intermediate calculations to the nearest whole dollar amount.) Maximum total depreciation (including $179 expense) $ 1,216,488

Answer 1

Ans:

Assets	Useful life	original basis	$179 expense	Remaining basis	Rate	Amount($)
Machinery	7	$1,550,000	$1,000,000	$550,000	14.29%	$78,595
Computer equipment	5	$365,000		$365,000	20%	$73,000
Office building	39	$480,000		$480,000	1.819%	$8,731.20
						$160,326.20

Therefore maximum depreciation that AMP may deduct in 2019 including 179 expense is $1,000,000+$160,326.20 = $1,160,326.20