1. Perry develops a successful advertising business that he subsequently sells to his competitor, Carl, for $108,000. He retires in the same town where he has always lived and done business. Carl insists that Perry sign a covenant not to compete. The advertising business has no tangible assets; Carl receives only the name of the business, the client lists and whatever going-concern value there is. If the purchase occurred on July 1st, how much amortization should Carl claim related to the covenant not to compete in the year of purchase?

2. On May 3rd, 2017 Bobs Bus Service purchases a used bus for $85,000. This was his only asset purchases for the year. Bob wishes to maximize his depreciation for the year. Ignoring any income limitations, how much depreciation can Bob claim related to the purchase of the buses?

3. On July 20, 2017, XYZ Inc. purchased a new airplane for $3,000,000. The airplane will not be used in commercial or contract carrying of passengers or freight (5 year life). This is the companys only asset purchase of the year. XYZ Inc. wants to maximize its depreciation. Ignoring any income limitations, what amount of depreciation can XYZ Inc. can claim in 2017 related to the purchase of the airplane?