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Depreciation A firm is evaluating the acquisition of an asset that costs $69,800 and requires $3,830 in installation costs. If the firm depreciates the asset under MACRS, using a 5-year recovery period (see table ), determine the depreciation charge for each year. The annual depreciation expense for year 1 will be $. (Round to the nearest dollar.) O Data Table The annual depreciation expense for year 2 will be $. (Round to the nearest dollar.) The annual depreciation expense for year 3 will be $. (Round to the nearest dollar.) (Click on the icon located on the top-right corner of the data table below in order to copy its contents into a spreadsheet.) The annual depreciation expense for year 4 will be $. (Round to the nearest dollar.) Rounded Depreciation Percentages by Recovery Year Using MACRS for First Four Property Classes The annual depreciation expense for year 5 will be $. (Round to the nearest dollar.) Percentage by recovery year Recovery year 3 years 5 years 7 years 10 years The annual depreciation expense for year 6 will be $. (Round to the nearest dollar.) 1 33% 20% 14% 10% 45% 32% 25% 18% 3 15% 19% 18% 14% 7% 12% 12% 12% 5 12% 5% 9% 9% 6 9% 8% 7 9% 7% 8 4% 6% 9 6% 10 6% 11 4% 100% 100% 100% 100% Totals *These percentages have been rounded to the nearest whole percent to simplify calculations while retaining realism. To calculate the actual depreciation for tax purposes, be sure to apply the actual unrounded percentages or directly apply double-declining balance (200%) depreciation using the half-year convention. Print Done

Depreciation A firm is evaluating the acquisition of an asset that costs $69,800 and requires $3,830 in installation costs. If the firm depreciates the asset under MACRS, using a 5-year recovery period (see table ), determine the depreciation charge for each year. The annual depreciation expense for year 1 will be $. (Round to the nearest dollar.) O Data Table The annual depreciation expense for year 2 will be $. (Round to the nearest dollar.) The annual depreciation expense for year 3 will be $. (Round to the nearest dollar.) (Click on the icon located on the top-right corner of the data table below in order to copy its contents into a spreadsheet.) The annual depreciation expense for year 4 will be $. (Round to the nearest dollar.) Rounded Depreciation Percentages by Recovery Year Using MACRS for First Four Property Classes The annual depreciation expense for year 5 will be $. (Round to the nearest dollar.) Percentage by recovery year Recovery year 3 years 5 years 7 years 10 years The annual depreciation expense for year 6 will be $. (Round to the nearest dollar.) 1 33% 20% 14% 10% 45% 32% 25% 18% 3 15% 19% 18% 14% 7% 12% 12% 12% 5 12% 5% 9% 9% 6 9% 8% 7 9% 7% 8 4% 6% 9 6% 10 6% 11 4% 100% 100% 100% 100% Totals *These percentages have been rounded to the nearest whole percent to simplify calculations while retaining realism. To calculate the actual depreciation for tax purposes, be sure to apply the actual unrounded percentages or directly apply double-declining balance (200%) depreciation using the half-year convention. Print Done

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Depreciation A firm is evaluating the acquisition of an asset that costs $69,800 and requires $3,830 in installation costs. If the firm depreciates the asset under MACRS, using a 5-year recovery period (see table 9), determine the depreciation charge for each year. Data Table The annual depreciation expense for year 1 will be $ (Round to the nearest dollar.) The annual depreciation expense for year 2 will be $ (Round to the nearest dollar.) (Click on the icon located on the top-right corner of the data table below in order to copy its contents into a The annual depreciation expense for year 3 will be $ (Round to the nearest dollar.) spreadsheet.) The annual depreciation expense for year 4 will be $ (Round to the nearest dollar.) Rounded Depreciation Percentages by Recovery Year Using MACRS for First Four Property Classes The annual depreciation expense for year 5 will be $ Percentage by recovery year* 5 years (Round to the nearest dollar.) Recovery year 3 years 7 years 10 years The annual depreciation expense for year 6 will be $ (Round to the nearest dollar.) 1 33% 20% 14% 10% 2 45% 32% 25% 18% 3 15% 19% 18% 14% 4 7% 12% 12% 12% 12% 9% 9% 5% 9% 8% 7 9% 7% 4% 6% 6% 10 6% 11 4% Totals 100% 100% 100% 100% *These percentages have been rounded to the nearest whole percent to simplify calculations while retaining realism. To calculate the actual depreciation for tax purposes, be sure to apply the actual unrounded percentages or directly apply double-declining balance (200%) depreciation using the half-year convention. Print Done
Transcribed Image Text:Depreciation A firm is evaluating the acquisition of an asset that costs $69,800 and requires $3,830 in installation costs. If the firm depreciates the asset under MACRS, using a 5-year recovery period (see table 9), determine the depreciation charge for each year. Data Table The annual depreciation expense for year 1 will be $ (Round to the nearest dollar.) The annual depreciation expense for year 2 will be $ (Round to the nearest dollar.) (Click on the icon located on the top-right corner of the data table below in order to copy its contents into a The annual depreciation expense for year 3 will be $ (Round to the nearest dollar.) spreadsheet.) The annual depreciation expense for year 4 will be $ (Round to the nearest dollar.) Rounded Depreciation Percentages by Recovery Year Using MACRS for First Four Property Classes The annual depreciation expense for year 5 will be $ Percentage by recovery year* 5 years (Round to the nearest dollar.) Recovery year 3 years 7 years 10 years The annual depreciation expense for year 6 will be $ (Round to the nearest dollar.) 1 33% 20% 14% 10% 2 45% 32% 25% 18% 3 15% 19% 18% 14% 4 7% 12% 12% 12% 12% 9% 9% 5% 9% 8% 7 9% 7% 4% 6% 6% 10 6% 11 4% Totals 100% 100% 100% 100% *These percentages have been rounded to the nearest whole percent to simplify calculations while retaining realism. To calculate the actual depreciation for tax purposes, be sure to apply the actual unrounded percentages or directly apply double-declining balance (200%) depreciation using the half-year convention. Print Done
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