Homework Answers
As per section 179, the deduction amount cannot exceed the business income of $8,600.
Remaining cost for the conference table = Cost of the conference table - Business income
= $ 22,300 - $ 8,600 = $ 13,700
MACRS deduction for $ 13,700 at 7 year rate = $13,700 * 14.29% = $ 1,957.73 = $ 1,958.
Maximum cost recovery for 2018 on conference table = $8,600 + $1,958 = $10,558
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Problem 6-46 (LO 6-3) Michael is the sole proprietor of a small business. In June 2018,...
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...
Casper used the following assets in his Schedule C trade or business in the tax year...
Casper used the following assets in his Schedule C trade or
business in the tax year 2018. Casper is a new client and
unfortunately does not have a copy of his prior year's tax return.
He recalls that all of the assets purchased in prior years used
MACRS depreciation (no §179 expense or bonus). Casper does not wish
to take §179 or bonus depreciation. (Use Table 6A-1 and Table 6A-8)
Calculate the current year depreciation allowance for Casper’s
business. (Round...
Question 3 (10 points): Using the Modified Accelerated Cost Recovery method (table A-1), calculate the depreciation...
Question 3 (10 points):
Using the Modified Accelerated Cost Recovery method (table A-1),
calculate the depreciation of $2,500,000 property for 7-year half
-year convention. Note: you just need to calculate the
depreciation; you do not need to use it in any further
calculations.
Table A-1. 3-, 5-, 7-, 10-, 15-, and 20-Year Property Half-Year Convention Depreciation rate for recovery period Year 3-year 5-year 7-year 10-year 15-year 20-year 33.33% 44.45 14.81 20.00% 32.00 19.20 11.52 11.52 14.29% 24.49 17.49 12.49 8.93...
Arlington LLC purchased an automobile for $80,000 on July 5, 2018. What is Arlington's depreciation expense...
Arlington LLC purchased an automobile for $80,000 on July 5, 2018. What is Arlington's depreciation expense for 2018 if its business use percentage is 80 percent (ignore any possible bonus depreciation)? (Use MACRS Table 1, and Exhibit 10-10.) Multiple Choice None of the choices are correct. $12,000. $6,125. $8,000. $8,000. TABLE 1 MACRS Half-Year Convention Depreciation Rate for Recovery Period Year 3-Year 5-Year 10-Year 15-Year 20-Year 20.00% 32.00 19.20 11.52 11.52 5.76 7-Year 14.29% 24.49 17.49 12.49 8.93 8.92 8.93...
Arlington LLC purchased an automobile for $62,000 on July 5, 2018. What is Arlington's depreciation expense...
Arlington LLC purchased an automobile for $62,000 on July 5, 2018. What is Arlington's depreciation expense for 2018 if ts business use percentage is 61 percent (ignore any possible bonus depreciation)? (Use MACRS Table 1, and Exhibit 10-10) Multiple Choice $6,200 $6,100. $4,775 $9,300 None of the choices are correct. TABLE 1 MACRS Half-Year Convention Depreciation Rate for Recovery Period 7-Year 14.29% 24.49 17.49 12.49 8.93 8.92 8.93 4.46 Year 3-Year 5-Year 10-Year 1 5-Year 20-Year 33.33% 44.45 14.81 7.41...
THIS IS BASED ON 5 YEAR DEPRECIATION. 2. In plain English, explain how depreciation was calculated...
THIS IS BASED ON 5 YEAR DEPRECIATION.
2. In plain English, explain how depreciation was calculated for
years 1-3.
3)In plain English, explain how depreciation was calculating for
years 4-6
Table A-1. 3-, 5-, 7-, 10-, 15-, and 20-Year Property Half-Year Convention Depreciation rate for recovery period Year 3-year 5-year 7-year 10-year 15-year 20-year 33.33% 44.45 14.81 7.41 20.00% 32.00 19.20 14.29% 24.49 17.49 12.49 8.93 10.00% 18.00 14.40 11.52 9.22 5.00% 9.50 8.55 7.70 6.93 3.750% 7.219 6.677 6.177...
On April 5, 2019, Kinsey places in service a new passenger automobile that cost $60,000. The...
On April 5, 2019, Kinsey places in service a new passenger automobile that cost $60,000. The car is used 100% for business in each tax year. Kinsey uses the MACRS 200% declining-balance method of cost recovery (the auto is a 5-year asset). Assume Kinsey elects any available additional first-year depreciation. The maximum depreciation allowed for 2019 is $ 12000 X and for 2020 is S 16000 20 5 Hint(s) EXHIBIT 8.4 MACRS Accelerated Depreciation for Personal Property Assuming Half-Year Convention...
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...
Please refer to IRS Publication 946 2. In plain English, explain how depreciation was calculated for...
Please refer to IRS Publication 946
2. In plain English, explain how depreciation was calculated for
years 1-3.
3. In plain English, explain how depreciation was calculating
for years 4-6 (Hint: See MACRS4 solution, end-of-year basis for
year 3; divide by 5, but you must explain why you divided by
5).
4. Additional comments (optional):
Table A-1. 3-, 5-, 7-, 10-, 15-, and 20-Year Property Half-Year Convention Depreciation rate for recovery period 3-year 5-year 7-year 10-year 15-year Year 20-year 33.33%...
Clay LLC placed in service machinery and equipment (seven-year property) with a basis of $3,462,500 on...
Clay LLC placed in service machinery and equipment (seven-year property) with a basis of $3,462,500 on June 6, 2019. Assume that Clay has sufficient income to avoid any limitations. Calculate the maximum depreciation expense including $179 expensing (ignoring any possible bonus depreciation). (Use MACRS Table 1) (Round final answer to the nearest whole number.) Multiple Choice $494,791 $1,011073 $459,430. None of the choices are correct $686.930 Table 1 MACRS Half-Year Convention 20-Year Year 1 3.750% Year 2 7.219 Depreciation Rate...
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...
Casper used the following assets in his Schedule C trade or
business in the tax year 2018. Casper is a new client and
unfortunately does not have a copy of his prior year's tax return.
He recalls that all of the assets purchased in prior years used
MACRS depreciation (no §179 expense or bonus). Casper does not wish
to take §179 or bonus depreciation. (Use Table 6A-1 and Table 6A-8)
Calculate the current year depreciation allowance for Casper’s
business. (Round...
Question 3 (10 points):
Using the Modified Accelerated Cost Recovery method (table A-1),
calculate the depreciation of $2,500,000 property for 7-year half
-year convention. Note: you just need to calculate the
depreciation; you do not need to use it in any further
calculations.
Table A-1. 3-, 5-, 7-, 10-, 15-, and 20-Year Property Half-Year Convention Depreciation rate for recovery period Year 3-year 5-year 7-year 10-year 15-year 20-year 33.33% 44.45 14.81 20.00% 32.00 19.20 11.52 11.52 14.29% 24.49 17.49 12.49 8.93...
Arlington LLC purchased an automobile for $80,000 on July 5, 2018. What is Arlington's depreciation expense for 2018 if its business use percentage is 80 percent (ignore any possible bonus depreciation)? (Use MACRS Table 1, and Exhibit 10-10.) Multiple Choice None of the choices are correct. $12,000. $6,125. $8,000. $8,000. TABLE 1 MACRS Half-Year Convention Depreciation Rate for Recovery Period Year 3-Year 5-Year 10-Year 15-Year 20-Year 20.00% 32.00 19.20 11.52 11.52 5.76 7-Year 14.29% 24.49 17.49 12.49 8.93 8.92 8.93...
Arlington LLC purchased an automobile for $62,000 on July 5, 2018. What is Arlington's depreciation expense for 2018 if ts business use percentage is 61 percent (ignore any possible bonus depreciation)? (Use MACRS Table 1, and Exhibit 10-10) Multiple Choice $6,200 $6,100. $4,775 $9,300 None of the choices are correct. TABLE 1 MACRS Half-Year Convention Depreciation Rate for Recovery Period 7-Year 14.29% 24.49 17.49 12.49 8.93 8.92 8.93 4.46 Year 3-Year 5-Year 10-Year 1 5-Year 20-Year 33.33% 44.45 14.81 7.41...
THIS IS BASED ON 5 YEAR DEPRECIATION.
2. In plain English, explain how depreciation was calculated for
years 1-3.
3)In plain English, explain how depreciation was calculating for
years 4-6
Table A-1. 3-, 5-, 7-, 10-, 15-, and 20-Year Property Half-Year Convention Depreciation rate for recovery period Year 3-year 5-year 7-year 10-year 15-year 20-year 33.33% 44.45 14.81 7.41 20.00% 32.00 19.20 14.29% 24.49 17.49 12.49 8.93 10.00% 18.00 14.40 11.52 9.22 5.00% 9.50 8.55 7.70 6.93 3.750% 7.219 6.677 6.177...
On April 5, 2019, Kinsey places in service a new passenger automobile that cost $60,000. The car is used 100% for business in each tax year. Kinsey uses the MACRS 200% declining-balance method of cost recovery (the auto is a 5-year asset). Assume Kinsey elects any available additional first-year depreciation. The maximum depreciation allowed for 2019 is $ 12000 X and for 2020 is S 16000 20 5 Hint(s) EXHIBIT 8.4 MACRS Accelerated Depreciation for Personal Property Assuming Half-Year Convention...
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...
Please refer to IRS Publication 946
2. In plain English, explain how depreciation was calculated for
years 1-3.
3. In plain English, explain how depreciation was calculating
for years 4-6 (Hint: See MACRS4 solution, end-of-year basis for
year 3; divide by 5, but you must explain why you divided by
5).
4. Additional comments (optional):
Table A-1. 3-, 5-, 7-, 10-, 15-, and 20-Year Property Half-Year Convention Depreciation rate for recovery period 3-year 5-year 7-year 10-year 15-year Year 20-year 33.33%...
Clay LLC placed in service machinery and equipment (seven-year property) with a basis of $3,462,500 on June 6, 2019. Assume that Clay has sufficient income to avoid any limitations. Calculate the maximum depreciation expense including $179 expensing (ignoring any possible bonus depreciation). (Use MACRS Table 1) (Round final answer to the nearest whole number.) Multiple Choice $494,791 $1,011073 $459,430. None of the choices are correct $686.930 Table 1 MACRS Half-Year Convention 20-Year Year 1 3.750% Year 2 7.219 Depreciation Rate...
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