For the properties listed below compute the depreciation taken during the useful life of the property. Assume that all property is post-1986 property. Assign 15 percent of the cost to land for residential and commercial properties. property. 2. Include columns for the applicable AMT depreciation and the accompanying AMT adjustment. FACT: The AMT adjustment for personal property is the difference between the depreciation taken under MACRS and the amount determined by using the 150% declining balance (DB) method under ADS. The AMT adjustment for real property is the difference between the depreciation taken under MACRS and the amount determined by using the straight line (SL) method under ADS. PROPERTY COST PLACED IN SERVICE Tractor unit 35,000 15 Feb Racehorse over 2 years old 6,000 12 May Computer 5,000 25 Nov Luxury Automobile 86,000 15 May 2021 General Purpose Truck 44,000 13 Oct Office Desk 4,200 5 Jan Office Safe 10,800 7 Sept Light Boat 15,000 27 July Petroleum Refining Installation 126,000 15 June Residential Rental Building 8,,500,000 26 April Nonresidential Rental Building 4,000,000 20 Nov WHILE MAKING THE EXCEL SHEET, INCLUDE THESE COLUMNS Asset Description, Date Placed in Service, Cost Basis, Recovery Rate, MACRS RECOVERY AMOUNT, MACRS Accumulated Depreciation, Adjusted Basis, AMT Rate, AMT Recovery Amount, AMT Accumulated Depreciation, AMT Adjustment, AMT Adjusted Basis.

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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1: For the properties listed below compute the depreciation taken during the useful life of the property. Assume that all property is post-1986 property. Assign 15 percent of the cost to land for residential and commercial properties. property. 2. Include columns for the applicable AMT depreciation and the accompanying AMT adjustment. FACT: The AMT adjustment for personal property is the difference between the depreciation taken under MACRS and the amount determined by using the 150% declining balance (DB) method under ADS. The AMT adjustment for real property is the difference between the depreciation taken under MACRS and the amount determined by using the straight line (SL) method under ADS. PROPERTY COST PLACED IN SERVICE Tractor unit 35,000 15 Feb Racehorse over 2 years old 6,000 12 May Computer 5,000 25 Nov Luxury Automobile 86,000 15 May 2021 General Purpose Truck 44,000 13 Oct Office Desk 4,200 5 Jan Office Safe 10,800 7 Sept Light Boat 15,000 27 July Petroleum Refining Installation 126,000 15 June Residential Rental Building 8,,500,000 26 April Nonresidential Rental Building 4,000,000 20 Nov WHILE MAKING THE EXCEL SHEET, INCLUDE THESE COLUMNS Asset Description, Date Placed in Service, Cost Basis, Recovery Rate, MACRS RECOVERY AMOUNT, MACRS Accumulated Depreciation, Adjusted Basis, AMT Rate, AMT Recovery Amount, AMT Accumulated Depreciation, AMT Adjustment, AMT Adjusted Basis.

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