Net realizable value: Net realizable value is defined as the amount from the sale of asset after deducting all expenses related to sale. (a) To determine the amount that needs to be recorded as balance in the Allowance to Reduce Inventory to NRV.

Question

Assume that TDW Corporation (calendar-year-end) has 2024 taxable income of $952,000 for purposes of computing the §179 expense. The company acquired the following assets during 2024: (Use MACRS Table 1, Table 2, Table 3, Table 4, and Table 5.) Asset Machinery Computer equipment Furniture Total Placed in Service September 12 February 10 April 2 Basis $ 2,270,250 263,325 880,425 $ 3,414,000 b. What is the maximum total depreciation, including §179 expense, that TDW may deduct in 2024 on the assets it placed in service in 2024, assuming no bonus depreciation? Note: Round your intermediate calculations and final answer to the nearest whole dollar amount. Maximum total depreciation deduction (including §179 expense)

Answer 1

Question

Chapter 9, Problem 2P

To determine

Net realizable value: Net realizable value is defined as the amount from the sale of asset after deducting all expenses related to sale.

(a)

To determine the amount that needs to be recorded as balance in the Allowance to Reduce Inventory to NRV.

To determine

(b)

To determine the amount of the gain or loss for the fiscal year.

To determine

(c)

To explain: To explain the use of the LCNRV rule to inventories.

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