Please solve this one A taxpayer acquires equipment for $10,000.Which one of the following choices is not an acceptable cost recoveryperiod under either MACRS (regular or alternate) or ADS?a) Straight-line for 7 yearsb) Straight-line for 10 yearsc) 150% declining balance for 7 yearsd) 150% declining balance for 10 yearse) 200% declining balance for 7 yearsAn accumulated depreciation account: (Only choose one.)A. increases on the debit sideB. has a normal credit balanceC. is offset against total assets on the balance sheetD. is a contra-liability account

Answer (1): Option (d). 150% declining balance for 10 years.MACRS and ADS are two depreciation…

Answered: A taxpayer acquires equipment for…

Individual Income Taxes

43rd Edition

ISBN:9780357109731

Author:Hoffman

Publisher:Hoffman

Chapter8: Depreciation, Cost Recovery, Amortization, And Depletion

Section: Chapter Questions

Problem 27CE: LO.4 On April 5, 2019, Kinsey places in service a new automobile that cost 60,000. He does not elect...

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Similar questions

A taxpayer acquires office equipment for $10,000. Which one of the following choices is not an acceptable cost recovery period under either MACRS (regular or alternate) or ADS? O Straight-line for 7 years O straight-line for 10 years O 150% declining balance for 7 years O 150% declining balance for 10 years
A taxpayer places a $1,050,000 5-year recovery period asset in service in 2020. This is the only asset placed in service in 2020. Assuming half-year convention, an election to expense under Section 179, and no income limitation, what is the amount of total cost recovery deduction (no bonus depreciation)? a.$210,000 b.$1,040,000 c.$1,026,000 d.$1,050,000 e.$1,042,000
A taxpayer places a $50,000 5-year recovery period asset in service in 2020. This is the only asset placed in service in 2020. Assuming half-year convention, no immediate expensing, what is the amount of bonus depreciation? a.$50,000 b.$10,000 c.$25,000 d.$0 e.None of these choices are correct.
A taxpayer places a $50,000 5-year recovery period asset in service in 2020. This is the only asset placed in service in 2020. Assuming half-year convention, no immediate expensing, what is the adjusted basis of of the assets after applying 2020 bonus depreciation? a.$50,000 b.$25,000 c.$0 d.$10,000 e.None of these choices are correct.
You purchase an asset that has a 10-year recovery period, per IRS tax code. This asset has a cost basis of $9.200. How much depreciation could you take in year 4? O $1.060 O $1,149 O $9.200 O $848
A taxpayer places a $50,000 5-year recovery period asset (not an auto) in service in 2021. This is the only asset placed in service in 2021. Assuming half-year convention, bonus depreciation, and taxable income before cost recovery of $5,000, what is the amount of cost recovery in 2021? a.$5,000 b.$25,000 c.$30,000 d.$0 e.$50,000
A taxpayer places a $50,000 5-year recovery period asset (not an auto) in service in 2021. This is the only asset placed in service in 2021. Assuming no special elections (for example, election to expense), what is the amount of total cost recovery deduction? Oa. $25,000 Ob. $5,000 Oc. $30,000 Od. so Oe. $50,000
A company purchases an asset that costs $10,000. This asset qualifies as 3-year property under MACRS. The company uses an after-tax discount rate of 12% and faces a 40% income tax rate. (Use Table 1, Table 2 and Exhibit 12.4.) Year MACRS % Depreciation Deduction Tax Savings PV Factor Present Values 1 33.33% 3,333.00 1,333.20 0.893 1,190.55 2 44.45% 4,445.00 1,778.00 0.797 1,417.07 3 14.81% 1,481.00 592.40 0.712 421.79 4 7.41% 741.00 296.40 0.636 188.51 100% 10,000.00 4,000.00 3,217.91 2. Given an after-tax discount rate of 12%, what tax rate would be needed in order for the PV of the depreciation deductions to equal $4,000?
4. A company establishes a depreciation account for an asset that is classified as Sec.1245property. The account is based on the MACRS with a life of seven years and an initial cost of$100,000. Without considerable of the sale of this asset, the company's taxable income is$400,000. Determine the following if the asset is sold after 5 years: a. The federal tax liability if the asset is sold for$15,000. b. The federal tax liability if the asset is sold for$160,000. c. The federal tax liability if the asset is sold for$90,000.
The depreciated value of the washing machine can be modeled by the equation V= _______ + __________t. $ 1045 Washing machine is depreciated for tax purposes $ 95 per year. V = depricated value and t number of years since purchse date
1. A special manufacturing and handling device was purchased by Alfonso Manufacturing for $200,000 and is depreciated over MACRS. CFBT is estimated to amount to $800,000 for the first 2 years followed by $600,000 thereafter until the asset is retained. The effective tax rate, Te is 35% and interest is 10% per year. In present worth dollars determine the CFAT and determine if it was a viable purchase. (Note answer must be in a tabular format)
Reversing Rapids Co. purchases an asset for $147,552. This asset qualifies as a five-year recovery asset under MACRS. The five-year expense percentages for years 1, 2, 3, and 4 are 20.00%, 32.00%, 19.20%, and 11.52% respectively. Reversing Rapids has a tax rate of 30%. The asset is sold at the end of year 4 for $11,409. Calculate book value of an asset. Round the answer to two decimals. Answer: (25,496.99) answer is given pls how to get

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