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Karane Enterprises, a calendar-year manufacturer based in College Station, Texas, began business in 2018. In the process of setting up the business, Karane has acquired various types of assets. Below is a list of assets acquired during 2018:

Asset	Cost		Date Placed in Service
Office furniture	$	150,000	02/03/2018
Machinery		1,560,000	07/22/2018
Used delivery truck*		40,000	08/17/2018

*Not considered a luxury automobile.

During 2018, Karane was very successful (and had no §179 limitations) and decided to acquire more assets in 2019 to increase its production capacity. These are the assets acquired during 2019:

Asset	Cost		Date Placed in Service
Computers & info. system	$	400,000	03/31/2019
Luxury auto†		80,000	05/26/2019
Assembly equipment		1,200,000	08/15/2019
Storage building（office space）		700,000	11/13/2019

†Used 100% for business purposes.

Karane generated taxable income in 2019 of $1,732,500 for purposes of computing the §179 expense. (Use MACRS Table 1, Table 2, Table 3, Table 4, Table 5, and Exhibit 10-10.) (Leave no answer blank. Enter zero if applicable. Input all the values as positive numbers.)

b. Compute the maximum 2019 depreciation deductions, including §179 expense (ignoring bonus depreciation).

description	cost	sec.179 expense	macrs basis	current macrs depreciation	total depreciation deduction
2018 assets
office furniture
machinery
used delivery truck
2019 assets
computers & info. system
Luxury Auto
Assembly equipment
Storage building
total

Answer 1

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