24.

If you own a business, and the business owns land which declines in value, the land may be depreciated for tax purposes.

Answer:

False True

25.

An asset (not an automobile) put in service in June 2020 has a depreciable basis of $535,000 and a recovery period of 5 years. Assuming bonus depreciation is used, a half-year MACRS convention, and no Section 179 expensing election is made, what is the maximum amount of cost that can be deducted in 2020?

$321,000 $374,500 $535,000 $107,000 $267,500

26.

Guardian Industries Corp bought a glass making machine on January 1, 2018 for $31,250. The company did not elect Section 179 expensing and elected out of claiming bonus depreciation in 2018, and is depreciating the machine using the MACRS accelerated depreciation tables for 5-year property. What is the 2020 depreciation (Year 3) deduction for the machine?

$6,250 $6,000 $10,000 $12,500 None of the above is correct

27.

During 2020, Thomas purchases $13,000 of used manufacturing equipment (7-year property) for use in his business, his only asset purchase that year. Thomas has taxable income from his business of $51,000 (before deducting any depreciation). What is the maximum amount that Thomas may deduct in 2020 under the Section 179 election to expense?

$0 $13,000 $500,000 None of the above $25,000