Question

QUESTION 4 Grape Corporation purchased a machine in December of the current year. This was the only set purchased during the current year. The machine was placed in service in January of the following year No assets were purchased in the following year. Grape Corporation's cost recovery would begin In the current year using a mid quarter convention b. In the current year using a half-year convention c. In the following year using a mid-quarter convention Od. In the following year ring a half year convention e. None of the above QUESTIONS Hans purchased a new passenger automobile on August 17, 2020, for $30.000 Daring the year the car was used 40% for business and 60% for personal use. Determine his cost recovery deduction for the car for 2020 O a $500 b. $1,000 51.200 O d. 51,333 e. None of the above QUESTIONS In 2019, Gail had a $ 119 deduction carryover of $30,000. In 2020, she elected § 179 for an asset acquired at a cost of S115,000. Gail's $ 179 business income limitation for 2020 is 140,000 Determine Gail's $ 179 deduction for 2020. a $25,000 6.5115,000 OG $130,000

Answer 1

Requirement 1 (Question 4):-

The correct answer for the question is Option D - In the following year using Half - Year convention. The date that needs to be considered for claiming depreciation expense on a property is the date on which the asset was placed in service. Additionally, if the company did not place more than 40% of the assets during the last quarter of the year, then the company should use the Half Year convention to depreciate its assets during the year. As such, this is the correct answer.

Option A and Option B are incorrect because the asset is placed in service only in the next year . Hence, the depreciation deduction cannot be claimed in the current year.

Option C is incorrect as the company placed the asset in service during the first quarter . As mentioned above, the mid quarter convention applies only if the asset placed atleast 40% of its assets during the last quarter.

Option E is incorrect as we already have the answer at Option D.

Kindly note that i have answered the first question per the HOMEWORKLIB RULESs. Request you to post the remaining question separately so that we can answer them as well. All the best and please let me know if you have any questions via the comments section .