Question

2. In 2017, Rose Company purchased one asset costing $38,400 and elected to expense the entire cost. However, Rose could only deduct $21,000 of the Section 179 expense because of the taxable income limitation. In 2018, Rose purchased tangible personalty costing $990,000. Rose's 2018 taxable income without regard to any Section 179 deduction was $1,912,400. Compute Rosc's 2018 Section 179 deduction. A) $17,400 B) $1,000,000 C) $1,007,400 D) SO

Answer 1

The Answer is option B as per section 179 Depreciation Deduction the deduction limit is up to 1 million dollars for qualified assets. Qualified assets are those that are tangible personal assets that are be going to used for the purpose of business and for the purpose of deduction they should be put to use in the current year in which the deduction is being claimed. As the Rose company has done everything that is under section 179. So the deduction is allowed up to 1 million dollars.