### MACRS Mid-Quarter Convention TablesThese tables show the Modified Accelerated Cost Recovery System (MACRS) depreciation rates under the Mid-Quarter Convention for different recovery periods and placement quarters.#### Table 2a: First Quarter**For property placed in service during the first quarter**| Year | 5-Year (%) | 7-Year (%) ||------|------------|------------|| 1 | 25.00 | 17.85 || 2 | 30.00 | 23.47 || 3 | 18.00 | 16.76 || 4 | 11.37 | 11.97 || 5 | 11.37 | 8.87 || 6 | 4.26 | 8.87 || 7 | | 8.87 || 8 | | 3.34 |#### Table 2b: Second Quarter**For property placed in service during the second quarter**| Year | 5-Year (%) | 7-Year (%) ||------|------------|------------|| 1 | 15.00 | 10.71 || 2 | 34.00 | 25.51 || 3 | 20.40 | 18.22 || 4 | 12.24 | 13.02 || 5 | 11.30 | 9.30 || 6 | 7.06 | 8.85 || 7 | | 8.86 || 8 | | 5.53 |#### Table 2c: Third Quarter**For property placed in service during the third quarter**| Year | 5-Year (%) | 7-Year (%) ||------|------------|------------|| 1 | 5.00 | 3.57 || 2 | 38.00 | 27.55 || 3 | 22.80 | 19.68 || 4 | 13.68 | 14.06 || 5 | 10.94 | 10.04 | **Business Asset Depreciation Example**Lina purchased a new car for use in her business during 2021. The car was the only business asset she acquired that year, and her business was extremely profitable. Calculate her maximum depreciation deductions (including §179 expense unless stated otherwise) for the automobile in 2021 and 2022. Lina doesn’t want to take bonus depreciation for 2021 or 2022 in the following scenarios (assuming half-year convention for all): (Use MACRS Table 1, Table 2, and Exhibit 10-10.)**Scenario:**d. The vehicle cost $92,000, and she used it 80 percent for business purposes. She sold it on March 1 of year 2.**Depreciation Deduction Table:**- Year: 2021 - Depreciation Deduction: [Blank space]- Year: 2022 - Depreciation Deduction: [Blank space]Note: The table indicates that there are amount placeholders for the depreciation deductions for each year, which need to be calculated using the MACRS tables and the specified conditions.

Depreciation is the amount that is charged on the fixed assets by which the asset value decreases…

Lina purchased a new car for use in her business during 2021. The auto was the only business asset she purchased during the year, and her business was extremely profitable. Calculate her maximum depreciation deductions (including §179 expense unless stated otherwise) for the automobile in 2021 and 2022 (Lina doesn't want to take bonus depreciation for 2021 or 2022) in the following alternative scenarios (assuming half-year convention for all): (Use MACRS Table 1, Table 2, and Exhibit 10-10.) d. The vehicle cost $92,000, and she used it 80 percent for business. She sold it on March 1 of year 2. Depreciation Year deduction 2021 2022

Lina purchased a new car for use in her business during 2021. The auto was the only business asset she purchased during the year, and her business was extremely profitable. Calculate her maximum depreciation deductions (including §179 expense unless stated otherwise) for the automobile in 2021 and 2022 (Lina doesn't want to take bonus depreciation for 2021 or 2022) in the following alternative scenarios (assuming half-year convention for all): (Use MACRS Table 1, Table 2, and Exhibit 10-10.) d. The vehicle cost $92,000, and she used it 80 percent for business. She sold it on March 1 of year 2. Depreciation Year deduction 2021 2022

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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Maggie purchased a passenger car on June 1, 2022 for $28,000. She placed it in service in her business on June 1, 2022 and it is used exclusively for the business. What is Maggie's cost recovery deduction in 2022 assuming she did not elect $179 expensing but did take bonus depreciation. O 18,200 O 13,440 19,200 28,000 2
[The following information applies to the questions displayed below.] Lina purchased a new car for use in her business during 2023. The auto was the only business asset she purchased during the year, and her business was extremely profitable. Calculate her maximum depreciation deductions (including §179 expense unless stated otherwise) for the automobile in 2023 and 2024 (Lina doesn't want to take bonus depreciation for 2023 or 2024) in the following alternative scenarios (assuming half-year convention for all): (Use MACRS Table 1 Table 2, and Exhibit 10-10.) c. The vehicle cost $80,000, and she used it 80 percent for business. Depreciation deduction Year 2023 $ 2024 16,100
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Required information Skip to question [The following information applies to the questions displayed below.] Lina purchased a new car for use in her business during 2023. The auto was the only business asset she purchased during the year, and her business was extremely profitable. Calculate her maximum depreciation deductions (including $179 expense unless stated otherwise) for the automobile in 2023 and 2024 (Lina doesn't want to take bonus depreciation for 2023 or 2024) in the following alternative scenarios ( assuming half-year convention for all): (Use MACRS Table 1, Table 2, and Exhibit 10 - 10.) e. The vehicle cost $83, 800, and she used it 20 percent for business.
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