Chapter A, Problem 4P

Use the information in Problem A-1 to solve this problem. Assume that the van is five-year property for tax purposes.

Required

Prepare a schedule of depreciation under MACRS. Round figures to the nearest whole dollar.

PROBLEM A-1 A delivery van was bought for $18,000. The estimated life of the van is four years. The trade-in value at the end of four years is estimated to be $2,000.

Check Figure

Year 3 depreciation, $3,456