chapter 8 homework solutions tax

# chapter 8 homework solutions tax - p 8-10 45 a Copier...

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Individual Tax Accounting and Planning – 2011 Edition Chapter 8 homework solutions 36. The mid-quarter convention must be used because the cost of the computers acquired in the 4th quarter exceeds 40% of the cost of all the personal property acquired during the year (\$60,000/\$140,000 = 43%). Furniture (7-year class) MACRS cost recovery (\$50,000 × .1785) (Table 8.2) 8,925 Trucks (5-year class) MACRS cost recovery (\$30,000 × .15) (Table 8.2) 4,500 Computers (5-year class) MACRS cost recovery (\$60,000 × .05) (Table 8.2) 3,000 Total cost recovery \$16,425 pp. 8-5 to 8-9 39. 2010: \$1,800,000 × .01605 (Table 8.6) = \$28,890 2020: \$1,800,000 × .02564 (Table 8.6) = \$46,152 p. 8-10 40. The building’s depreciable basis is \$1,200,000 [\$1,400,000 (cost) – \$200,000 (land)]. a. 2010: \$1,200,000 × .0197 (Table 8.6) = \$23,640 b. 2016: \$1,200,000 × .03636 (Table 8.6) × 10.5/12 = \$38,178

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Unformatted text preview: p. 8-10 45. a. Copier Immediate expense deduction under Â§ 179 \$ 50,000 Furniture Immediate expense deduction under Â§ 179 200,000 (\$250,000 â€“ \$50,000) MACRS cost recovery [(\$275,000 â€“ \$200,000) Ã— .1429] 10,718 Total deduction \$260,718 c. Furniture Immediate expense deduction under Â§ 179 \$250,000 MACRS cost recovery [(\$275,000 â€“ \$250,000) Ã— .1429] 3,573 Copier Immediate expense deduction under Â§ 179 â€“0â€“ MACRS cost recovery (\$50,000 Ã— .20) 10,000 Individual Tax Accounting and Planning â€“ 2011 Edition Chapter 8 homework solutions Total deduction \$263,573 c. The deduction for the year would be \$2,855 (\$263,573 â€“ \$260,718) larger if Â§ 179 expense is first allocated to the furniture (i.e., the longer lived asset). pp. 8-5 to 8-14 and Table 8.1...
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