Karane Enterprises, a calendar-year manufacturer based in College Station, Texas, began business in 2023. In the process of setting up the business, Karane has acquired various types of assets. Below is a list of assets acquired during 2023: Date Placed in Asset Office furniture Cost Service Machinery Used delivery truck* $ 150,000 1,560,000 40,000 02/03 07/22 08/17 *Not considered a luxury automobile. During 2023, Karane was very successful (and had no $179 limitations) and decided to acquire more assets in 2024 to increase its production capacity. These are the assets acquired during 2024 Date Placed in Asset Computers and information system Cost $ 400,000 Service 03/31 Luxury auto* 80,000 05/26 Assembly equipment Storage building 1,200,000 700,000 28/15 11/16 *Used 100 percent for business purposes. Karane generated taxable income in 2024 of $1,732,500 for purposes of computing the $179 expense limitation. (Use MACRS Table 1, Table 2, Table 3, Table 4, Table 5, and Exhibit 10-10.) Note: Leave no answer blank. Enter zero if applicable. Input all the values as positive numbers. Required: c. Compute the maximum 2024 depreciation deductions, including $179 expense, but now assume that Karane would like to take bonus depreciation. Note: Round your final answers to nearest whole dollar. Description 2023 Assets Office Furniture Machinery Used Delivery Truck 2024 Assets Answer is not complete. Section Current Cost 179 Expense Bonus MACRS Basis MACRS Depreciation Total Cost Recovery Deduction $ 150,000 $ 0 $ $ 150,000 36,735 $ 1,560,000 40,000 1,080,000 x 40,000 216,000 x 12,800 36,735 216,000 12,800 Computers and Information System 400,000 0 X Luxury Auto 0 80,000 8,000 72,000 12,200 × Assembly Equipment 1,200,000 1,160,000 x Storage Building 20,200 1,160,000 700,000 Total $ 4,130,000 $ 1,160,000 2,247 8,000 $ 1,342,000 $ 279,982 www 2,247 $ 1,447,982
Karane Enterprises, a calendar-year manufacturer based in College Station, Texas, began business in 2023. In the process of setting up the business, Karane has acquired various types of assets. Below is a list of assets acquired during 2023: Date Placed in Asset Office furniture Cost Service Machinery Used delivery truck* $ 150,000 1,560,000 40,000 02/03 07/22 08/17 *Not considered a luxury automobile. During 2023, Karane was very successful (and had no $179 limitations) and decided to acquire more assets in 2024 to increase its production capacity. These are the assets acquired during 2024 Date Placed in Asset Computers and information system Cost $ 400,000 Service 03/31 Luxury auto* 80,000 05/26 Assembly equipment Storage building 1,200,000 700,000 28/15 11/16 *Used 100 percent for business purposes. Karane generated taxable income in 2024 of $1,732,500 for purposes of computing the $179 expense limitation. (Use MACRS Table 1, Table 2, Table 3, Table 4, Table 5, and Exhibit 10-10.) Note: Leave no answer blank. Enter zero if applicable. Input all the values as positive numbers. Required: c. Compute the maximum 2024 depreciation deductions, including $179 expense, but now assume that Karane would like to take bonus depreciation. Note: Round your final answers to nearest whole dollar. Description 2023 Assets Office Furniture Machinery Used Delivery Truck 2024 Assets Answer is not complete. Section Current Cost 179 Expense Bonus MACRS Basis MACRS Depreciation Total Cost Recovery Deduction $ 150,000 $ 0 $ $ 150,000 36,735 $ 1,560,000 40,000 1,080,000 x 40,000 216,000 x 12,800 36,735 216,000 12,800 Computers and Information System 400,000 0 X Luxury Auto 0 80,000 8,000 72,000 12,200 × Assembly Equipment 1,200,000 1,160,000 x Storage Building 20,200 1,160,000 700,000 Total $ 4,130,000 $ 1,160,000 2,247 8,000 $ 1,342,000 $ 279,982 www 2,247 $ 1,447,982
Chapter8: Depreciation, Cost Recovery, Amortization, And Depletion
Section: Chapter Questions
Problem 47P
Related questions
Question
I want to know what I did wrong.
Transcribed Image Text:Karane Enterprises, a calendar-year manufacturer based in College Station, Texas, began business in 2023. In the process
of setting up the business, Karane has acquired various types of assets. Below is a list of assets acquired during 2023:
Date Placed in
Asset
Office furniture
Cost
Service
Machinery
Used delivery truck*
$ 150,000
1,560,000
40,000
02/03
07/22
08/17
*Not considered a luxury automobile.
During 2023, Karane was very successful (and had no $179 limitations) and decided to acquire more assets in 2024 to
increase its production capacity. These are the assets acquired during 2024
Date Placed in
Asset
Computers and information system
Cost
$ 400,000
Service
03/31
Luxury auto*
80,000
05/26
Assembly equipment
Storage building
1,200,000
700,000
28/15
11/16
*Used 100 percent for business purposes.
Karane generated taxable income in 2024 of $1,732,500 for purposes of computing the $179 expense limitation. (Use
MACRS Table 1, Table 2, Table 3, Table 4, Table 5, and Exhibit 10-10.)
Note: Leave no answer blank. Enter zero if applicable. Input all the values as positive numbers.
Transcribed Image Text:Required:
c. Compute the maximum 2024 depreciation deductions, including $179 expense, but now assume that Karane would like to take
bonus depreciation.
Note: Round your final answers to nearest whole dollar.
Description
2023 Assets
Office Furniture
Machinery
Used Delivery Truck
2024 Assets
Answer is not complete.
Section
Current
Cost
179
Expense
Bonus
MACRS
Basis
MACRS
Depreciation
Total Cost
Recovery
Deduction
$ 150,000
$
0
$
$ 150,000
36,735 $
1,560,000
40,000
1,080,000 x
40,000
216,000 x
12,800
36,735
216,000
12,800
Computers and Information System
400,000
0 X
Luxury Auto
0
80,000
8,000
72,000
12,200 ×
Assembly Equipment
1,200,000
1,160,000 x
Storage Building
20,200
1,160,000
700,000
Total
$ 4,130,000
$ 1,160,000
2,247
8,000
$ 1,342,000
$
279,982
www
2,247
$ 1,447,982
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