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421 chapter 8 in-class problems-completed

# 421 chapter 8 in-class problems-completed - 31 Cost of the...

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31 Cost of the asset less the larger of depreciation allowed or allowable: In 2007, the allowable amount 455 In 2008, the allowable amount 3,636 Asset sold in January, 2009: \$100,000 * 3.636% * .5/12 = Adjusted basis of the asset on disposition Sales proceeds less adjusted basis on date of disposition Gain on sale of asset 35 Cost of asset less 50% bonus allowance Remaining basis subject to MACRS MACRS deduction % MACRS deduction amount Remaining basis subject to MACRS MACRS deduction % 32% * .5 Asset's original basis less cost recovery deductions Adjusted basis when sold 36 April furniture 50,000 July trucks 30,000 November computers 60,000 140,000 Furniture Cost 50,000 less 50% additional allowance (25,000) Remaining basis for MACRS 25,000 MACRS % from Table 8.2 17.85% MACRS deduction amount 4,463 Total deduction amount for 2009 29,463

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37 a In 2009, \$3,700,000 * .535%= b In 2013, \$3,700,000 * 2.564% * 6.5/12 = 45 §179 copie Copier Cost of assets 50,000 §179 (50,000) Remaining basis - 50% first year allowance - MACRS basis - MACRS % from table 8.1 20.00% MACRS deduction amount - 5-year Total deduction amount 50,000 292,859 a c Choose b to maximize deduction in current yea 46 250,000 Olga's net business income before cost recove (95,000) less cost recovery deductions on all other asse 155,000 Olga's net business income before cost recove (92,885) MACRS cost recovery deduction on new 7-yea
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421 chapter 8 in-class problems-completed - 31 Cost of the...

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