Logo
Home Study Material Contact Search
AI Chat FREE
  1. business
  2. accounting
  3. denver inc purchased a 5 year asset in november fo

Denver Inc purchased a 5 year asset in November for $20,000. This is the only asset...

Free

70.2K

Verified Solution

Question

Accounting

Denver Inc purchased a 5 year asset in November for $20,000.This is the only asset the company placed in service during thatyear. Neither the straight line method nor the 150% decliningbalance method was elected. The company elects out of bonusdepreciation an the Section 179 expense deduction. Denver Inc soldthe asset in September of Year 3. What is the depreciation in theyear of sale? A. $2,350, B. $2,850, C. $3,250, D. $3,450

Answer & Explanation Solved by verified expert
4.4 Ratings (900 Votes)

Answer is B $2850

calculation explained below

TABLE A-5 FOR 3 YEARS CLASS PROPERTY MID QUARTER Convention—Declining Balance is used
PLACE IN SERVICE IN LAST QUARTER
YEAR ASSET VALUE RATE OF DEPRECIATION AS PER TABLE A-15

AMOUNT OF DEPRECIATION
1 $          20,000 5 $                                             1,000
2 $          20,000 38 $                                             7,600
3 $          20,000 22.8 $                                             2,850
NOTE: DEPRECATION FOR THE YEAR OF SALE IS ADJUSTED TO 62.5% OF TOTAL DEPRECIATION
ADJUSTMENT FACTOR = (NO. OF QUARTER IN YEAR OF SALE INCLUDING QUARTER OF SALE-.5)/4
,=(3-.5)/4
0.625
OR 62.5%

Get Answers to Unlimited Questions

Join us to gain access to millions of questions and expert answers. Enjoy exclusive benefits tailored just for you!

Membership Benefits:
  • Unlimited Question Access with detailed Answers
  • Zin AI - 3 Million Words
  • 10 Dall-E 3 Images
  • 20 Plot Generations
  • Conversation with Dialogue Memory
  • No Ads, Ever!
  • Access to Our Best AI Platform: Zin AI - Your personal assistant for all your inquiries!
Become a Member

Other questions asked by students

Q

Question 56 (1 point) To measure T cell function, we perform Question 56 options: serum protein electrophoresis CD18 surface...

Biology
Q

Describe intracellular trafficking of CI-M6PR, with names of specific molecules involved in the process, and its...

Biology
Q

The dibasic compound B (pKb1 = 4.00, pKb2 = 8.00) was titrated with 1.00 M HCl....

Chemistry
Q

O 5 O thymine OH hydrogen bonds H N 3 Sugar phosphate backbone NH guanine...

Biology
Q

Quadrilateral ABCD is a rectangle AC 5p 10 and BD 9p 2 What is the...

Geometry
Q

lodule 7 Two stical Inference K Question 20 Part 1 o The pass completion percentages...

Statistics
Q

The 2018 income statement of Adrian Express reports sales of $22,310,000, cost of...

Accounting
Q

Sampson Co. sold merchandise to Batson Co. on account, $46,000, terms 2/15, net 45....

Accounting
Q

Thank you! Problem 4-49 (Algo) Application of Overhead; Cost Flows [LO 4-3,...

Accounting
Q

4 Exercise B-18 Practical applications of the time value of money LO P1, P2, P3,...

Accounting
Q

Required information Use the following information for the Exercises below. The following information applies to...

Accounting
Q

Q3-5 3 Henry owned 10 shares of XYZ Corp. stock for...

Accounting