60.1K

Verified Solution

Link Copied!

thank you

Bob's Burgers purchased only one asset during the current year (a full 12-month tax year ending on Dec. 31), some machinery for use in the business. On December 1, Bob's Burgers placed the machinery (seven-year property) in service with an initial basis of $70,000. Calculate the maximum depreciation expense (ignoring $179 and bonus depreciation). (Use MACRS Table 2.) (Round final answer to the nearest whole number.) Multiple Choice $2,499. $3,500. $10,001 $14,000 None of the choices are correct. TABLE 2 MACRS Mid-Quarter Convention: For property placed in service during the first quarter Depreciation Rate for Recovery Period 5-Year 7. Year Year! 3500 25.00% Year 2 26.00 2143 Year 3 15.60 15 31 Year 4 11.01 10.93 Year 5 11.01 8.75 Year 6 1.38 8.74 Year 7 8.75 Year 1.09 TABLE 26 MACRS Mid-Quarter Convention: For property placed in service during the second quarter Depreciation Rate for Recovery Period 5-Year 7-Year Year! 25.00% 1785% Year 2 30.00 2347 Year 3 18.00 16.76 Year 4 11.37 1197 Year 5 11.37 8.87 Year 6 4.26 887 Year 7 8.87 Year 8 TABLE 2 MACRS Mid-Quarter Convention: For property placed in service during the third quarter Depreciation Rate for Recovery Period 5-Year 7-Year Year! 15.00% 10.719 Year 2 34.00 2551 Year 3 20.40 18 22 Year 4 12.34 13.02 Year 5 11.30 9.30 Year 6 7.06 885 Year 7 Year 8 553 TABLE 2 MACRS-Mid Quarter Convention: For property placed in service during the fourth quarter Depreciation Rate for Recovery Period 5-Year 7-Year Year! 5.00% 3.57% Year 2 38.00 2755 Year 3 2280 1968 Year 4 13.68 1406 Years 10.94 1004 Year 6 958 8.73 Year 7 8.73 Year 8 764 8.86

Answer & Explanation Solved by verified expert

See Answer