A Company placed into service a forklift in 2018 which costs $20,000; assume 7 year life....
A Company placed into service a forklift in 2018 which costs $20,000; assume 7 year life. Using MACRS show the depreciation for 2018, 2019 and 2020. Show the adjusted basis after the 2020 depreciation.
Homework Answers
Calculation of Depriciation
2018 = $20000 / 7 = $2857
2019 = ($20000 - $2857) / 6 = $2857
2020 = ($20000 - $5714) / 6 = $2857
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A Company placed into service a forklift in 2018 which costs
$20,000; assume 7 year life....
A Company placed into service an apartment building in March, 2018 which costs $200,000. Using MACRS...
A Company placed into service an apartment building in March, 2018 which costs $200,000. Using MACRS show the depreciation for 2018, 2019 and 2020. Show the adjusted basis after the 2020 depreciation
In April of 2019, Jack purchased and placed in service $70,000 of automobiles (5-year class life)...
In April of 2019, Jack purchased and placed in service $70,000 of automobiles (5-year class life) for his business. In August of 2019, he purchased and placed in service $40,000 of trucks (5-year class life) for his business. In November of 2019, he purchased and placed in service $90,000 of furniture (7-year class life) for his business. These are the only assets placed in service during the year. His taxable income (before the 179 deduction) for 2019 is $50,000. Jack...
. 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...
2. January 2, 2018, Trey's Toy Company purchased and placed in service a machine with a...
2. January 2, 2018, Trey's Toy Company purchased and placed in service a machine with a cost of $350,0000, The company estimated the machine's useful life to be ten years or 200,000 units of ouiput with an estimated salvage value of $25,000. During 2018, the machine produced 30.000 units during 2019, the machine produced 40,000 units. Calculate the depreciation expense for 2018 and 2019 at year end under each depreciation method. The straight-line method of depreciation. a. b. The units-of-production...
3. MACRS. (Obj. 1) Florence placed in service the following properties during 2019. Compute Florence's total...
3. MACRS. (Obj. 1) Florence placed in service the following properties during 2019. Compute Florence's total depreciation expense for 2019 and 2020, assuming that she elects to expense 50 percent of the cost of qualifying property. She elects out of bonus depreciation. The machine, equipment, and furniture are 7-year property. Type of Property Cost Date Placed in Service Machine $130,000 March 3, 2018 Equipment 110,000 June 8, 2018 Furniture 48,000 August 15, 2018 Office building 200,000 October 4, 2018
Campbell Company has an opportunity to purchase a forklift to use in its heavy equipment rental...
Campbell Company has an opportunity to purchase a forklift to use in its heavy equipment rental business. The forklift would be leased on an annual basis during its first two years of operation. Thereafter, it would be leased to the general public on demand. Campbell would sell it at the end of the fifth year of its useful life. The expected cash inflows and outflows follow: Year Nature of item Cash Inflow Cash outflow 2018 Purchase price $82,600 2018...
12-68 Petty Corporation has been depreciating equipment over a 10-year life on which costs $24,000, was...
12-68
Petty Corporation has been depreciating equipment over a 10-year life on which costs $24,000, was purchased on January 1, 2016. The equi $6,000. On the basis of experience since acquisition, management has decided to a total life of 14 years instead of 10, with no change in the estimated residual al tive on January 1, 2020. The annual financial statements are prepared on a c presented). 2019 income and 2020 income before depreciation for 2019 and 2020 wer respectively....
A small warehousing company is planning to buy a new forklift today to replace an existing...
A small warehousing company is planning to buy a new forklift
today to replace an existing one. The purchase price of the new
forklift is $30,000. Each year the new forklift is operated, you
will incur operating and maintenance (O&M) costs which are
provided in the table below. The new forklift follows a declining
balance depreciation model. The salvage values after the first year
are estimated to be $22,500. The company uses a MARR of 10% for all
financial analysis....
Section 179. In May 2019, Riddick Enterprises placed in service new 7 year property costing $1,100,000...
Section 179. In May 2019, Riddick Enterprises placed in service new 7 year property costing $1,100,000 and new 5 year property costing $1,100,000. These are the only two properties Riddick placed in service during the year. Riddick elects out of bonus depreciation. a. Compute Riddick's total depreciation expense deduction assuming Riddick uses regular MACRS and elects to take the maximum Section 179 expense on the 5 year property. b. Compute Riddick's total depreciation expense deduction assuming Riddick uses regular MACRS...
On July 2, 2018, a taxpayer placed in service a new computer that cost $4,000. The...
On July 2, 2018, a taxpayer placed in service a new computer that cost $4,000. The computer is used 100% for business. No Section 179 was taken on the computer in 2018, but 50% bonus depreciation and MACRS were used to depreciate the computer. If this was the only property placed in service during 2018, the taxpayer's 2019 depreciation on the computer would be: A. $400 O B. $200. оо C. $800. D. $1,280. E. $640.
In April of 2019, Jack purchased and placed in service $70,000 of automobiles (5-year class life) for his business. In August of 2019, he purchased and placed in service $40,000 of trucks (5-year class life) for his business. In November of 2019, he purchased and placed in service $90,000 of furniture (7-year class life) for his business. These are the only assets placed in service during the year. His taxable income (before the 179 deduction) for 2019 is $50,000. Jack...
.
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...
2. January 2, 2018, Trey's Toy Company purchased and placed in service a machine with a cost of $350,0000, The company estimated the machine's useful life to be ten years or 200,000 units of ouiput with an estimated salvage value of $25,000. During 2018, the machine produced 30.000 units during 2019, the machine produced 40,000 units. Calculate the depreciation expense for 2018 and 2019 at year end under each depreciation method. The straight-line method of depreciation. a. b. The units-of-production...
3. MACRS. (Obj. 1) Florence placed in service the following properties during 2019. Compute Florence's total depreciation expense for 2019 and 2020, assuming that she elects to expense 50 percent of the cost of qualifying property. She elects out of bonus depreciation. The machine, equipment, and furniture are 7-year property. Type of Property Cost Date Placed in Service Machine $130,000 March 3, 2018 Equipment 110,000 June 8, 2018 Furniture 48,000 August 15, 2018 Office building 200,000 October 4, 2018
12-68
Petty Corporation has been depreciating equipment over a 10-year life on which costs $24,000, was purchased on January 1, 2016. The equi $6,000. On the basis of experience since acquisition, management has decided to a total life of 14 years instead of 10, with no change in the estimated residual al tive on January 1, 2020. The annual financial statements are prepared on a c presented). 2019 income and 2020 income before depreciation for 2019 and 2020 wer respectively....
A small warehousing company is planning to buy a new forklift
today to replace an existing one. The purchase price of the new
forklift is $30,000. Each year the new forklift is operated, you
will incur operating and maintenance (O&M) costs which are
provided in the table below. The new forklift follows a declining
balance depreciation model. The salvage values after the first year
are estimated to be $22,500. The company uses a MARR of 10% for all
financial analysis....
On July 2, 2018, a taxpayer placed in service a new computer that cost $4,000. The computer is used 100% for business. No Section 179 was taken on the computer in 2018, but 50% bonus depreciation and MACRS were used to depreciate the computer. If this was the only property placed in service during 2018, the taxpayer's 2019 depreciation on the computer would be: A. $400 O B. $200. оо C. $800. D. $1,280. E. $640.
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