Required information Comprehensive Problem 02-76 (LO 02-1, LO 02-2, LO 02-3, LO 02-4, LO 02-5) (Algo) [The following information applies to the questions displayed below.] Karane Enterprises, a calendar-year manufacturer based in College Station, Texas, began business in 2020. In the process of setting up the business, Karane has acquired various types of assets. Below is a list of assets acquired during 2020: Date Placed in Service 02/03/2020 07/22/2020 08/17/2020 Asset Cost $ 180, 000 1, 566, 000 46, 000 *Not considered a luxury automobile. Office furniture Machinery Used delivery truck* During 2020, Karane was very successful (and had no $179 limitations) and decided to acquire more assets in 2021 to increase its production capacity. These are the assets acquired during 2021: Date Placed in Service 03/31/2021 05/26/2021 08/15/2021 11/13/2021 Asset Cost Computers and information system Luxury autof Assembly equipment Storage building $ 406, 000 81, 500 1, 230, 000 700, 000 tUsed 100% for business purposes. Karane generated taxable income in 2021 of $1,740,000 for purposes of computing the $179 expense limitation. (Use MACRS Table 1. Table 2. Table 3, Table 4. Table 5, and Exhibit 10-10.) (Leave no answer blank. Enter zero if applicable. Input all the values as positive numbers.) Comprehensive Problem 02-76 Part a (Algo) Required: 1. Compute the maximum 2020 depreciation deductions, including $179 expense (ignoring bonus depreciation). Current Total Cost Description Cost $179 Expense MACRS Basis MACRS Recovery Deduction Depreciation Office furniture 180,000 s of s 180,000 Machinery 1,566,000 1,000,000 566,000 1,000,000 Used delivery truck 46,000 46,000 Total $ 1,792,000S 1,000,000 S 792,000 S 1,000,000
Required information Comprehensive Problem 02-76 (LO 02-1, LO 02-2, LO 02-3, LO 02-4, LO 02-5) (Algo) [The following information applies to the questions displayed below.] Karane Enterprises, a calendar-year manufacturer based in College Station, Texas, began business in 2020. In the process of setting up the business, Karane has acquired various types of assets. Below is a list of assets acquired during 2020: Date Placed in Service 02/03/2020 07/22/2020 08/17/2020 Asset Cost $ 180, 000 1, 566, 000 46, 000 *Not considered a luxury automobile. Office furniture Machinery Used delivery truck* During 2020, Karane was very successful (and had no $179 limitations) and decided to acquire more assets in 2021 to increase its production capacity. These are the assets acquired during 2021: Date Placed in Service 03/31/2021 05/26/2021 08/15/2021 11/13/2021 Asset Cost Computers and information system Luxury autof Assembly equipment Storage building $ 406, 000 81, 500 1, 230, 000 700, 000 tUsed 100% for business purposes. Karane generated taxable income in 2021 of $1,740,000 for purposes of computing the $179 expense limitation. (Use MACRS Table 1. Table 2. Table 3, Table 4. Table 5, and Exhibit 10-10.) (Leave no answer blank. Enter zero if applicable. Input all the values as positive numbers.) Comprehensive Problem 02-76 Part a (Algo) Required: 1. Compute the maximum 2020 depreciation deductions, including $179 expense (ignoring bonus depreciation). Current Total Cost Description Cost $179 Expense MACRS Basis MACRS Recovery Deduction Depreciation Office furniture 180,000 s of s 180,000 Machinery 1,566,000 1,000,000 566,000 1,000,000 Used delivery truck 46,000 46,000 Total $ 1,792,000S 1,000,000 S 792,000 S 1,000,000
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Required information
Comprehensive Problem 02-76 (LO 02-1, LO 02-2, LO 02-3, LO 02-4, LO 02-5) (Algo)
[The following information applies to the questions displayed below.]
Karane Enterprises, a calendar-year manufacturer based in College Station, Texas, began business in 2020. In the process
of setting up the business, Karane has acquired various types of assets. Below is a list of assets acquired during 2020:
Date Placed in
Asset
Office furniture
Service
02/03/2020
07/22/2020
08/17/2020
Cost
$ 180, 000
Machinery
Used delivery truck*
*Not considered a luxury automobile.
1, 566, 000
46, 000
During 2020, Karane was very successful (and had no $179 limitations) and decided to acquire more assets in 2021 to
increase its production capacity. These are the assets acquired during 2021:
Date Placed in
Asset
Service
Computers and information system
Luxury autot
Assembly equipment
Storage building
Cost
$ 406, 000
81, 500
1, 230, 000
700, 000
03/31/2021
05/26/2021
08/15/2021
11/13/2021
tused 100% for business purposes.
Karane generated taxable income in 2021 of $1,740,000 for purposes of computing the $179 expense limitation.
(Use MACRS Table 1, Table 2, Table 3, Table 4, Table 5, and Exhibit 10-10.) (Leave no answer blank. Enter zero if
applicable. Input all the values as positive numbers.)
Comprehensive Problem 02-76 Part a (Algo)
Required:
a. Compute the maximum 2020 depreciation deductions, including $179 expense (ignoring bonus depreciation).
Current
Total Cost
Description
Cost
§179 Expense MACRS Basis
MACRS
Recovery
Deduction
Depreciation
Office furniture
$
180,000 $
o $
180,000
2$
Machinery
1,566,000
1,00
566,000
1,000,000
Used delivery truck
46,000
ol
46,000
Total
$
1,792,000
$
1.000.000 $
792,000
$
$
1,000,000](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F73907ca2-1228-44b0-96a3-eb2affd82e48%2F9d65d92d-1b57-44d1-a0bb-a117f4ad43bd%2F9acxmyd_processed.png&w=3840&q=75)
Transcribed Image Text:!
Required information
Comprehensive Problem 02-76 (LO 02-1, LO 02-2, LO 02-3, LO 02-4, LO 02-5) (Algo)
[The following information applies to the questions displayed below.]
Karane Enterprises, a calendar-year manufacturer based in College Station, Texas, began business in 2020. In the process
of setting up the business, Karane has acquired various types of assets. Below is a list of assets acquired during 2020:
Date Placed in
Asset
Office furniture
Service
02/03/2020
07/22/2020
08/17/2020
Cost
$ 180, 000
Machinery
Used delivery truck*
*Not considered a luxury automobile.
1, 566, 000
46, 000
During 2020, Karane was very successful (and had no $179 limitations) and decided to acquire more assets in 2021 to
increase its production capacity. These are the assets acquired during 2021:
Date Placed in
Asset
Service
Computers and information system
Luxury autot
Assembly equipment
Storage building
Cost
$ 406, 000
81, 500
1, 230, 000
700, 000
03/31/2021
05/26/2021
08/15/2021
11/13/2021
tused 100% for business purposes.
Karane generated taxable income in 2021 of $1,740,000 for purposes of computing the $179 expense limitation.
(Use MACRS Table 1, Table 2, Table 3, Table 4, Table 5, and Exhibit 10-10.) (Leave no answer blank. Enter zero if
applicable. Input all the values as positive numbers.)
Comprehensive Problem 02-76 Part a (Algo)
Required:
a. Compute the maximum 2020 depreciation deductions, including $179 expense (ignoring bonus depreciation).
Current
Total Cost
Description
Cost
§179 Expense MACRS Basis
MACRS
Recovery
Deduction
Depreciation
Office furniture
$
180,000 $
o $
180,000
2$
Machinery
1,566,000
1,00
566,000
1,000,000
Used delivery truck
46,000
ol
46,000
Total
$
1,792,000
$
1.000.000 $
792,000
$
$
1,000,000
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