In 2020, LRRR Corp., a calendar year corporation, acquired and placed in service the assets listed below. Asset Placed in Service Cost Recovery Period Computer 8/21/2020 1,050,000 5 years Machine 10/12/2020 1,000,000 7 years Warehouse 12/2/2020 2,000,000 39 years Assume (1) no bonus depreciation, (2) no Section 179 expense for question. 1. Assume LRRR Corp sold all assets on May 23, 2022. What is LRRR Corps's depreciation expense in 2022? 2. Explain what would be different is the Machine was placed in service on April 12, 2020. 3. If bonus depreciation is taken on all eligible assets, what is the total depreciation for 2020?
In 2020, LRRR Corp., a calendar year corporation, acquired and placed in service the assets listed below. Asset Placed in Service Cost Recovery Period Computer 8/21/2020 1,050,000 5 years Machine 10/12/2020 1,000,000 7 years Warehouse 12/2/2020 2,000,000 39 years Assume (1) no bonus depreciation, (2) no Section 179 expense for question. 1. Assume LRRR Corp sold all assets on May 23, 2022. What is LRRR Corps's depreciation expense in 2022? 2. Explain what would be different is the Machine was placed in service on April 12, 2020. 3. If bonus depreciation is taken on all eligible assets, what is the total depreciation for 2020?
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Question
In 2020, LRRR Corp., a calendar year corporation, acquired and placed in service the assets listed below.
Asset |
Placed in Service |
Cost |
Recovery Period |
Computer |
8/21/2020 |
1,050,000 |
5 years |
Machine |
10/12/2020 |
1,000,000 |
7 years |
Warehouse |
12/2/2020 |
2,000,000 |
39 years |
Assume (1) no bonus
1. Assume LRRR Corp sold all assets on May 23, 2022. What is LRRR Corps's depreciation expense in 2022?
2. Explain what would be different is the Machine was placed in service on April 12, 2020.
3. If bonus depreciation is taken on all eligible assets, what is the total depreciation for 2020?
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