samples Ch08

# Samples Ch08 - Depreciation Cost Recovery Amortization and Depletion 8-1 CHAPTER 8 DEPRECIATION COST RECOVERY AMORTIZATION AND DEPLETION

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Depreciation, Cost Recovery, Amortization, and Depletion 8-1 CHAPTER 8 DEPRECIATION, COST RECOVERY, AMORTIZATION, AND DEPLETION EXAMINATION QUESTIONS 1. On June 14, 2010, Ramone purchased a new automobile that cost \$20,000. The car is used 80% for business and 20% for personal use. In 2011, he used the automobile 30% for business and 70% for personal use. Determine the cost recovery recapture for 2011. a. \$2,000. b. \$1,600. c. \$848. d. \$-0-. e. None of the above. 2. Indigo Company acquires a new machine (ten-year property) on January 15, 2010, at a cost of \$100,000. Indigo also acquires another new machine (seven-year property) on November 5, 2010, at a cost of \$20,000. No election is made to use the straight-line method. The company does not make the § 179 election. Determine the total deductions in calculating taxable income related to the machines for 2010. a. \$12,000. b. \$12,858. c. \$55,000. d.

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## This note was uploaded on 03/20/2011 for the course ACT 4494 taught by Professor Burks during the Spring '10 term at Troy.

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Samples Ch08 - Depreciation Cost Recovery Amortization and Depletion 8-1 CHAPTER 8 DEPRECIATION COST RECOVERY AMORTIZATION AND DEPLETION

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