Required information [The following information applies to the questions displayed below.] Dain's Diamond Bit Drilling purchased the following assets this year. Asset Drill bits (5-year) Drill bits (5-year) Commercial building Original Basis $ 91,700 Purchase Date 25-Jan 25-Jul 96,700 254,000 22-Apr Assume its taxable income for the year was $70,000 for purposes of computing the $179 expense (assume no bonus depreciation). (Use MACRS Table 1, Table 2, Table 3, Table 4 and Table 5.) (Leave no answer blank. Enter zero if applicable.) b. What is Dain's maximum depreciation deduction for the year (including $179 expense)? (Round your intermediate calculations and final answer to the nearest whole dollar amount.) Depreciation Deduction (including $179 expense)

Required information [The following information applies to the questions displayed below.] Dain's Diamond Bit Drilling purchased the following assets this year. Asset Drill bits (5-year) Drill bits (5-year) Commercial building Original Basis $ 91,700 Purchase Date 25-Jan 25-Jul 96,700 254,000 22-Apr Assume its taxable income for the year was $70,000 for purposes of computing the $179 expense (assume no bonus depreciation). (Use MACRS Table 1, Table 2, Table 3, Table 4 and Table 5.) (Leave no answer blank. Enter zero if applicable.) b. What is Dain's maximum depreciation deduction for the year (including $179 expense)? (Round your intermediate calculations and final answer to the nearest whole dollar amount.) Depreciation Deduction (including $179 expense)

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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Computing Impairment of Intangible Assets Stiller Company had the following information for its three intangible assets. 1. Patent: A patent was purchased for $140,000 on June 30 of Year 1; Stiller estimated the useful life of the patent to be 15 years. On December 31 of Year 3, the estimated future cash flows attributed to the pat were $119,000. The fair value of the patent was $105,000. 2. Trademark: A trademark was purchased for $7,000 on August 31 of Year 2. The trademark is considered to have an indefinite life. The fair value of the trademark on December 31 of Year 3 is $3,500. 3. Goodwill: Stiller recorded goodwill in January of Year 2, related to a purchase of another company. The carrying value of goodwill is $42,000 on December 31 of Year 3. On December 31 of Year 3, the segment for which the goodwill relates had a fair value of $812,000. The book value of the net assets of the segment (including goodwill) is $840,000. a. Classify each of the intangible assets above as a…
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Required information Convers Corporation (calendar year-end) acquired the following assets during the current tax year: (ignore §179 expense and bonus depreciation for this problem): (Use MACRS Table 1, Table 2, and Table 5.) Asset Machinery Computer equipment Delivery truck* Furniture Date Placed in Service October 25 February 3 March 17 April 22 Original Basis $ 108,000 48,000 61,000 188,000 Total $ 405,000 *The delivery truck is not a luxury automobile. In addition to these assets, Convers installed qualified real property (MACRS, 15 year, 150% DB) on May 12 at a cost of $680,000. b. What is the allowable MACRS depreciation on Convers's property in the current year assuming Convers does not elect out of bonus depreciation (but does not take §179 expense)? Note: Round your intermediate calculations to the nearest whole dollar amount. MACRS depreciation $ 868,000
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Chaz Corporation has taxable income in 2021 of $313,600 for purposes of computing the $179 expense and acquired the following assets during the year. Asset Office furniture Computer equipment Delivery truck Qualified improvement property Total Placed in Service September 12 February 10 August 21 September 30 Maximum total depreciation deduction Basis $ 796,000 946,000 84,000 1,515,000 $3,341,000 What is the maximum total depreciation deduction that Chaz may deduct in 2021? (Use MACRS Table 1. Table 2. Table 3, Table 4 and Table 5.) (Round your intermediate calculations and final answer to the nearest whole dollar amount.)