At the beginning of the year, Dee began a calendar-year business and placed in service...
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Accounting
At the beginning of the year, Dee began a calendar-year business and placed in service the following assets during the year:
Asset
Date Acquired
Cost Basis
Computer equipment (5 year)
3/23
$5,000
Furniture (7 year)
5/12
$7,000
Pickup truck (5 year)
11/15
$10,000
Commercial building (39 year)
10/11
$270,000
Assuming Dee does not elect 179 expensing or bonus depreciation, determine Dees year 1 cost recovery for each asset.
[Hint: (1) Commercial building is a nonresidential real property with 39 years of recovery period. Assume the depreciation percentage for the year is 0.535%.
(2) Assume that Poplock chooses double declining (DB) method.
(3) Note that Poplock uses the mid-quarter [Do you why?] convention for personalty (e.g., computer equipment, furniture, truck) and mid-month convention for realty (e.g., building).]
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