Homework 29 Solution

Homework 29 Solution - Homework 29 Solution 1. A new...

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Homework 29 Solution 1. A new electric saw for cutting small pieces of lumber in a furniture factory has a cost basis of $4000, a 5-year depreciable life, and no salvage value. Calculate the annual depreciation amounts and book values each year using double-declining-balance switching to straight-line depreciation. Under DDB depreciation, d = 200%/5 = 40% so D t = 0.4 BV t-1 each year. DDB SL D t Year BV t D t D t Used 1 $4000.00 $1600.00 $800.00 $1600.00 2 $2400.00 $960.00 $600.00 $960.00 3 $1440.00 $576.00 $480.00 $576.00 4 $864.00 $345.60 $432.00 $432.00 5 $432.00 $172.80 $432.00 $432.00 2. Repeat Problem 1 using the MACRS with a 5-year recovery period. MACRS MACRS Year BV t d t D t 1 $4000.00 20.0 $800.00 2 $3200.00 32.0 $1280.00 3 $1920.00 19.2 $768.00 4 $1152.00 11.5 $460.00 5 $692.00 11.5 $460.00 6 $232.00 5.8 $232.00 3. In May 2009, your company purchased a new computer system for $32,500. Assume your tax year
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This note was uploaded on 12/07/2011 for the course CIVL 4111 taught by Professor Moore,l during the Fall '08 term at U. Memphis.

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