
Accounting Information Systems
11th Edition
ISBN: 9781337552127
Author: Ulric J. Gelinas, Richard B. Dull, Patrick Wheeler, Mary Callahan Hill
Publisher: Cengage Learning
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Question
Chapter 17, Problem 18DQ
Summary Introduction
To explain: The flaw in this reasoning.
Introduction:
Acquiring and implementing
It describes the acquisition of a system and its phases of development and the steps involved in it. It explains the difference between purchased and in-built systems. It explains the importance of the presence of an accountant in these systems.
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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
Date Placed in Service
Original Basis
Machinery
October 25
$ 70,000
Computer equipment
February 3
10,000
Delivery truck*Footnote asterisk
March 17
23,000
Furniture
April 22
150,000
Total
$ 253,000
*Footnote asteriskThe 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 $300,000.
a. What is the allowable MACRS depreciation on Convers's property in the current year assuming Convers does not elect §179 expense and elects out of bonus depreciation?
Last Chance Mine (LCM) purchased a coal deposit for $750,000. It estimated it would extract 12,000 tons of coal from the deposit. LCM mined the coal and sold it, reporting gross receipts of $1 million, $3 million, and $2 million for years 1 through 3, respectively. During years 1–3, LCM reported net income (loss) from the coal deposit activity in the amount of ($20,000), $500,000, and $450,000, respectively. In years 1–3, LCM extracted 13,000 tons of coal as follows:
(1) Tons of Coal
(2) Basis
Depletion (2) ÷ (1) Rate
Tons Extracted per Year
Year 1
Year 2
Year 3
12,000
$ 750,000
$ 62.50
2,000
7,200
3,800
Using the cost and percentage depletion computations from parts (a) and (b), what is LCM's actual depletion expense for each year?
Assume that ACW Corporation has 2024 taxable income of $1,500,000 for purposes of computing the §179 expense. The company acquired the following assets during 2024 (assume no bonus depreciation): (Use MACRS Table 1, Table 2, and Table 5.)
Asset
Placed in Service
Basis
Machinery
September 12
$ 470,000
Computer equipment
February 10
70,000
Delivery truck
August 21
93,000
Qualified real property (MACRS, 15 year, 150% DB)
April 2
1,380,000
Total
$ 2,013,000
What is the maximum amount of §179 expense ACW may deduct for 2024?
What is the maximum total depreciation that ACW may deduct in 2024 on the assets it placed in service in 2024?
Chapter 17 Solutions
Accounting Information Systems
Ch. 17 - What is systems development?Ch. 17 - What is the systems development life cycle (SDLC)?Ch. 17 - Prob. 3RQCh. 17 - What are the systems development objectives?Ch. 17 - Prob. 5RQCh. 17 - Prob. 6RQCh. 17 - Prob. 7RQCh. 17 - Prob. 8RQCh. 17 - Prob. 9RQCh. 17 - What is the purpose of conducting an effectiveness...
Ch. 17 - Prob. 11RQCh. 17 - What is systems selection?Ch. 17 - Prob. 13RQCh. 17 - Prob. 14RQCh. 17 - Prob. 15RQCh. 17 - Prob. 16RQCh. 17 - Why might a company issue an RFP for general...Ch. 17 - What is the difference between a specification and...Ch. 17 - Prob. 19RQCh. 17 - Prob. 20RQCh. 17 - Prob. 21RQCh. 17 - Prob. 22RQCh. 17 - What is the riskiest approach to systems...Ch. 17 - What two variables should be considered when...Ch. 17 - Prob. 25RQCh. 17 - Prob. 26RQCh. 17 - Prob. 27RQCh. 17 - Prob. 28RQCh. 17 - Prob. 29RQCh. 17 - Identify and discuss several factors affecting the...Ch. 17 - Prob. 2DQCh. 17 - Prob. 3DQCh. 17 - Prob. 4DQCh. 17 - Prob. 5DQCh. 17 - Prob. 6DQCh. 17 - Prob. 7DQCh. 17 - Prob. 8DQCh. 17 - Prob. 9DQCh. 17 - Prob. 10DQCh. 17 - Prob. 11DQCh. 17 - Prob. 12DQCh. 17 - Prob. 13DQCh. 17 - Prob. 14DQCh. 17 - Prob. 15DQCh. 17 - Prob. 16DQCh. 17 - Refer to the typical contents of a project...Ch. 17 - Prob. 18DQCh. 17 - Prob. 19DQCh. 17 - Search the Internet for an ERP failure that...Ch. 17 - Prob. 3SPCh. 17 - Prob. 4SPCh. 17 - Prob. 1PCh. 17 - Prob. 2PCh. 17 - TM Office Supplies, Inc., is a wholesale...Ch. 17 - Prob. 6PCh. 17 - Prob. 9P
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