Required: Compute the maximum 2023 depreciation deductions, including $179 expense (ignoring bonus depreciation). Note: Apply the $179 deduction to the most expensive eligible asset first. Round your final answers to nearest whole dollar. Description Cost $179 Expense MACRS Basis Current MACRS Depreciation Total Cost Recovery Deduction Office furniture Machinery $ Used delivery truck 380,000 $ 1,790,000 86,000 0$ 380,000 $ 0 1,790,000 1,790,000 0 0 Total $ 2,256,000 $ 1,790,000 $ 380,000 $ 0 $ 1,790,000 Required: b. Compute the maximum 2024 depreciation deductions, including $179 expense (ignoring bonus depreciation). Note: Round your final answers to nearest whole dollar. Answer is complete but not entirely correct. Description Cost 2023 Assets Office furniture Machinery Used delivery truck Section 179 Expense MACRS Basis Current Total Cost MACRS Recovery Depreciation Deduction $ 380,000 1,790,000 86,000 0 0 $ 380,000 ( $ 93,062 93,062 1,790,000 438,371 438,371 86,000 27,520 27,520 2024 Assets Computers and Information. 446,000 446,000 89,200 89,200 System Luxury Auto 91,500 0 91,500 10,100 10,100 Assembly Equipment 1,200,000 1,040,000 160,000 22,864 1,062,864 Storage Building 900,000 0 900,000 11,457 11,457 Required information [The following information applies to the questions displayed below.] 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: Asset Office furniture Machinery Used delivery truck* Date Placed in Cost Service $ 380,000 1,790,000 86,000 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 Cost Service Computers and information system $ 446,000 03/31 Luxury auto* Assembly equipment Storage building 91,500 1,200,000 900,000 05/26 08/15 11/13 *Used 100 percent for business purposes. Karane generated taxable income in 2024 of $1,790,000 for purposes of computing the $179 expense limitation. (Use MACRS Table 1, Table 2, Table 3, Table 4, Table 5, and Exhibit 10-10.) Note: Leave no answer blank. Enter zero if applicable. Input all the values as positive numbers.

Required: Compute the maximum 2023 depreciation deductions, including $179 expense (ignoring bonus depreciation). Note: Apply the $179 deduction to the most expensive eligible asset first. Round your final answers to nearest whole dollar. Description Cost $179 Expense MACRS Basis Current MACRS Depreciation Total Cost Recovery Deduction Office furniture Machinery $ Used delivery truck 380,000 $ 1,790,000 86,000 0$ 380,000 $ 0 1,790,000 1,790,000 0 0 Total $ 2,256,000 $ 1,790,000 $ 380,000 $ 0 $ 1,790,000 Required: b. Compute the maximum 2024 depreciation deductions, including $179 expense (ignoring bonus depreciation). Note: Round your final answers to nearest whole dollar. Answer is complete but not entirely correct. Description Cost 2023 Assets Office furniture Machinery Used delivery truck Section 179 Expense MACRS Basis Current Total Cost MACRS Recovery Depreciation Deduction $ 380,000 1,790,000 86,000 0 0 $ 380,000 ( $ 93,062 93,062 1,790,000 438,371 438,371 86,000 27,520 27,520 2024 Assets Computers and Information. 446,000 446,000 89,200 89,200 System Luxury Auto 91,500 0 91,500 10,100 10,100 Assembly Equipment 1,200,000 1,040,000 160,000 22,864 1,062,864 Storage Building 900,000 0 900,000 11,457 11,457 Required information [The following information applies to the questions displayed below.] 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: Asset Office furniture Machinery Used delivery truck* Date Placed in Cost Service $ 380,000 1,790,000 86,000 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 Cost Service Computers and information system $ 446,000 03/31 Luxury auto Assembly equipment Storage building 91,500 1,200,000 900,000 05/26 08/15 11/13 *Used 100 percent for business purposes. Karane generated taxable income in 2024 of $1,790,000 for purposes of computing the $179 expense limitation. (Use MACRS Table 1, Table 2, Table 3, Table 4, Table 5, and Exhibit 10-10.) Note: Leave no answer blank. Enter zero if applicable. Input all the values as positive numbers.

Intermediate Accounting: Reporting And Analysis

3rd Edition

ISBN:9781337788281

Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Chapter12: Intangibles

Section: Chapter Questions

Problem 13E

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