Question

0 Required information The following information applies to the questions displayed below] AMP Corporation (calendar-year-end) has 2018 taxable income of $1,010,000 for purposes of computing the $179 expense. During 2018, AMP acquired the following assets: (Use MACRS Table 1. Table 2. Table 3. Table 4 and Table 5) Placed in Asset Service Basis September 12 1,320,00 Machinery Computer equipment Office building Total 380,000 495,00e $ 2,195,000 February 10 April 2 b. What is the maximum total depreciation, including $179 expense, that AMP may deduct in 2018 on the assets it placed in service in 2018 assuming no bonus depreciation? (Round your intermediate calculations to the nearest whole dollar amount.) Maximum total depreciation (including § 179 expense)

Answer 1

Answer:

b. Compute the maximum total depreciation, including §179 expense, that AMP may deduct in 2018 on the assets it placed in service in 2018 assuming no bonus depreciation, in following manner.
						Asset	Original Basis	§179 Expense	Remaining Basis	Rate	Depreciation Expense
Machinery (7-year)	$13,20,000	$ 10,10,000	$ 3,10,000	14.29%	44,299
Computers (5- year)	3,80,000		3,80,000	20.00%	76,000
Office Building (39 year)	4,95,000		4,95,000	1.82%	9,004
	21,95,000	10,10,000	11,85,000		$ 1,29,303
Add:§179 Expense					$ 10,10,000
Total Depreciation Expense					$11,39,303