Exam 10: Property Acquisition and Cost Recovery

Which of the following business assets is not depreciated?

Wheeler LLC purchased two assets during the current year (a full 12-month tax year).Wheeler placed in service computer equipment (5-year property)on November 16 with a basis of $15,000 and furniture (7-year property)on April 20 with a basis of $11,000.Calculate the maximum depreciation expense (ignoring §179 and bonus depreciation).(Use MACRS Table 2 in the text)(Round final answer to the nearest whole number)

If a business mistakenly claims too little depreciation,the business must only reduce the asset's basis by the depreciation actually taken rather than the amount of the allowable depreciation.

Amit purchased two assets during the current year.Amit placed in service computer equipment (5-year property)on April 16ᵗʰ with a basis of $5,000 and furniture (7-year property)on September 9ᵗʰ with a basis of $20,000.Calculate the maximum depreciation expense (ignoring §179 and bonus depreciation).(Use MACRS Table 1 in the text)

Oksana started an LLC on November 2 of the current year.She incurred $30,000 of start-up costs.How much of the start-up costs can be immediately expensed for the year? How much amortization may Oksana deduct in the first year?

Roth,LLC purchased only one asset during the current year.Roth placed in service computer equipment (5-year property)on November 1ˢᵗ with a basis of $42,500.Calculate the maximum depreciation expense (ignoring §179 and bonus depreciation).(Use MACRS Table 2 in the text)

Deirdre's business purchased two assets during the current year (a full 12-month tax year).Deirdre placed in service computer equipment (5-year property)on January 20 with a basis of $15,000 and machinery (7-year property)on October 1 with a basis of $15,000.Calculate the maximum depreciation expense (ignoring §179 and bonus depreciation).(Use MACRS Table 2 in the text)(Round final answer to the nearest whole number)