TABLE 7.2 MACRS for Business Personalty (Half-Year Convention) Recovery Period 3-Year 5-Year 7-Year 10-Year 15-Year 20-Year Year Depreciation Rate 1 33.33% 20.00% 14.29% 10.00% 5.00% 3.750% 2 44.45 32.00 24.49 18.00 9.50 7.219 3 14.81 19.20 17.49 14.40 8.55 6.677 4 7.41 11.52 12.49 11.52 7.70 6.177 5 11.52 8.93 9.22 6.93 5.713 6 5.76 8.92 7.37 6.23 5.285 7 8.93 6.55 5.90 4.888 8 4.46 6.55 5.90 4.522 9 6.56 5.91 4.462 10 6.55 5.90 4.461 11 3.28 5.91 4.462 12 5.90 4.461 13 5.91 4.462 14 5.90 4.461 15 5.91 4.462 16 2.95 4.461 17 4.462 18 4.461 19 4.462 20 4.461 21 2.231 5 11 At the beginning of its 2024 tax year, Hiram owned the following business assets: points Mc Graw Hill Furniture Equipment Machinery Date Placed in Service Accumulated Recovery Depreciation Initial Cost Depreciation Period Convention 6/19/2022 5/2/2021 $55,500 $21,523 7-year Half-year 63,190 5-year Half-year 9/30/2021 49,306 5-year Half-year 88,750 69,250 On July 8, Hiram sold its equipment. On August 18, it purchased and placed in service new tools costing $610,000; these tools are three-year recovery property. These were Hiram's only capital transactions for the year. Required: Compute Hiram's maximum cost recovery deduction for 2024. In making your computation, assume that taxable income before depreciation exceeds $2,210,000. Use Table 7-2. Note: Enter all amounts as positive values. Round your intermediate computations and final answers to the nearest whole dollar amount. > Answer is complete but not entirely correct. 2024 MACRS Depreciation Furniture Equipment Machinery $ 7,941 x 8,525 12,110 x Total MACRS Depreciation $ 28,576 Section 179 on new tools 610,000 Maximum 2024 cost recovery deduction $ 638,576 < Prev 11 of 20 Next > Return to question
TABLE 7.2 MACRS for Business Personalty (Half-Year Convention) Recovery Period 3-Year 5-Year 7-Year 10-Year 15-Year 20-Year Year Depreciation Rate 1 33.33% 20.00% 14.29% 10.00% 5.00% 3.750% 2 44.45 32.00 24.49 18.00 9.50 7.219 3 14.81 19.20 17.49 14.40 8.55 6.677 4 7.41 11.52 12.49 11.52 7.70 6.177 5 11.52 8.93 9.22 6.93 5.713 6 5.76 8.92 7.37 6.23 5.285 7 8.93 6.55 5.90 4.888 8 4.46 6.55 5.90 4.522 9 6.56 5.91 4.462 10 6.55 5.90 4.461 11 3.28 5.91 4.462 12 5.90 4.461 13 5.91 4.462 14 5.90 4.461 15 5.91 4.462 16 2.95 4.461 17 4.462 18 4.461 19 4.462 20 4.461 21 2.231 5 11 At the beginning of its 2024 tax year, Hiram owned the following business assets: points Mc Graw Hill Furniture Equipment Machinery Date Placed in Service Accumulated Recovery Depreciation Initial Cost Depreciation Period Convention 6/19/2022 5/2/2021 $55,500 $21,523 7-year Half-year 63,190 5-year Half-year 9/30/2021 49,306 5-year Half-year 88,750 69,250 On July 8, Hiram sold its equipment. On August 18, it purchased and placed in service new tools costing $610,000; these tools are three-year recovery property. These were Hiram's only capital transactions for the year. Required: Compute Hiram's maximum cost recovery deduction for 2024. In making your computation, assume that taxable income before depreciation exceeds $2,210,000. Use Table 7-2. Note: Enter all amounts as positive values. Round your intermediate computations and final answers to the nearest whole dollar amount. > Answer is complete but not entirely correct. 2024 MACRS Depreciation Furniture Equipment Machinery $ 7,941 x 8,525 12,110 x Total MACRS Depreciation $ 28,576 Section 179 on new tools 610,000 Maximum 2024 cost recovery deduction $ 638,576 < Prev 11 of 20 Next > Return to question
Chapter20: Income Taxation Of Trusts And Estates
Section: Chapter Questions
Problem 8DQ
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Transcribed Image Text:TABLE 7.2 MACRS for Business Personalty (Half-Year Convention)
Recovery Period
3-Year
5-Year
7-Year
10-Year
15-Year
20-Year
Year
Depreciation Rate
1
33.33%
20.00%
14.29%
10.00%
5.00%
3.750%
2
44.45
32.00
24.49
18.00
9.50
7.219
3
14.81
19.20
17.49
14.40
8.55
6.677
4
7.41
11.52
12.49
11.52
7.70
6.177
5
11.52
8.93
9.22
6.93
5.713
6
5.76
8.92
7.37
6.23
5.285
7
8.93
6.55
5.90
4.888
8
4.46
6.55
5.90
4.522
9
6.56
5.91
4.462
10
6.55
5.90
4.461
11
3.28
5.91
4.462
12
5.90
4.461
13
5.91
4.462
14
5.90
4.461
15
5.91
4.462
16
2.95
4.461
17
4.462
18
4.461
19
4.462
20
4.461
21
2.231
Transcribed Image Text:5
11
At the beginning of its 2024 tax year, Hiram owned the following business assets:
points
Mc
Graw
Hill
Furniture
Equipment
Machinery
Date Placed in
Service
Accumulated
Recovery
Depreciation
Initial Cost Depreciation
Period
Convention
6/19/2022
5/2/2021
$55,500
$21,523
7-year
Half-year
63,190
5-year
Half-year
9/30/2021
49,306
5-year
Half-year
88,750
69,250
On July 8, Hiram sold its equipment. On August 18, it purchased and placed in service new tools costing $610,000; these tools are
three-year recovery property. These were Hiram's only capital transactions for the year.
Required:
Compute Hiram's maximum cost recovery deduction for 2024. In making your computation, assume that taxable income before
depreciation exceeds $2,210,000. Use Table 7-2.
Note: Enter all amounts as positive values. Round your intermediate computations and final answers to the nearest whole dollar
amount.
> Answer is complete but not entirely correct.
2024
MACRS
Depreciation
Furniture
Equipment
Machinery
$
7,941 x
8,525
12,110 x
Total MACRS Depreciation
$
28,576
Section 179 on new tools
610,000
Maximum 2024 cost recovery deduction
$
638,576
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