Question

10 A Saved Help Save & Exit Submit 87 Check my work Problem 10-48 (LO 10-2) [The following information applies to the questions displayed below.) At the beginning of the year, Anna began a calendar-year business and placed in service the following assets during the year: Asset Computers Office desks Machinery Office building Date Acquired 1/30 2/15 7/25 8/13 Cost Basis $ 28,000 $ 32,000 $ 75,000 $ 400,000 Assuming Anna does not elect $179 expensing and elects not to use bonus depreciation, answer the following questions: (Use MACRS Table 1, Table 2, Table 3, Table 4 and Table 5.) (Do not round intermediate calculations. Round your answers to the nearest whole dollar amount.) Problem 10-48 Part a a. What is Anna's year 1 cost recovery for each asset? Asset Computers Office desks Year 1 Cost Recovery $ 5,600 $ 4,573 $ 10,718 Machinery Office building Total $ 20,891

*For 2019

Thank you!

Answer 1

an Recovery period Acquisition date Asset Cost (years) Convention used 30-Jan Computers 28,000 5 Half-year convention 15-Feb Office desks 32,000 7 Half-year convention 25-Jul Machinery 75,000 7 Half-year convention 13-Aug Office building 4,00,000 39 Mid-month convention TOTAL COST RECOVERY FOR YEAR 1 Rate for year 1 Cost recovery 20% 5,600 14.29% 4,573 14.29% 10,718 3,846 (400000*0.02564*4.5/12) 24,736 Recovery period Acquisition date Asset Cost (years) Convention used 30-Jan Computers 28,000 5 Half-year convention 15-Feb Office desks 32,000 7 Half-year convention 25-Jul Machinery 75,000 7 Half-year convention 13-Aug Office building 4,00,000 TOTAL COST RECOVERY FOR YEAR 2 Rate for year 2 Cost recovery 32% 8,960 24.49% 7,837 24.49% 18,368 10,256 (400000*.02564) 45,420 89