35. On March 1, 2017 Harry Corporation (a calendaryear taxpayer) purchased and placed in-service office furniture costing $550,000.Compute the maximum amount Harry Corp. can elect to expense under Section 179 for this furniture if

a. this is the only asset placed in service this year by Harry Corp.

$550,000 - $510,000 x14.29% 1^st year = $5,716

$550,000 - $510,000 x24.49% 2^nd year = $9,796

$550,000 - $510,000 x 17.49% 3^rd year =$6,996

$550,000 - $510,000 x 12.49% 4^th year = $4,996

$550,000 - $510,000 x 8.93% 5^th year = $3,572

$550,000 - $510,000 x 8.92% 6^th year=$3,568

$550,000 - $510,000 x8.93% 7^th year =$3,572

$550,000 - $510,000 x 4.46%last year = $1,784$40,000 in total deductions

b. in addition to the $550,000 of office furniture, Harry Corp. also acquired and placed in service $980,000 of factory equipment during the year. Using 5-year MACRS rates

$980,000 - $510,000 x 20% 1^st year =$ 94,000

$980,000 - $510,000 x 32% 2^nd year =$150,400

$980,000 - $510,000 x 19.2% 3^rd year =$90,240

$980,000 - $510,000 x 11.52% 4^th year =$54,144

$980,000 - $510,000 x 11.52% 5^th year =$54,144

$980,000 - $510,000 x 5.76% last year =$27,072

$470,000

$550,000 - $510,000 x14.29% 1^st year =$5,716

$550,000 - $510,000 x24.49% 2^nd year =$9,796

$550,000 - $510,000 x 17.49%3^rd year =$6,996

$550,000 - $510,000 x 12.49%4^th year =$4,996

$550,000 - $510,000 x8.93%5^th year =$3,572

$550,000 - $510,000 x8.92%6^th year=$3,568

$550,000 - $510,000 x8.93% 7^th year =$3,572

$550,000 - $510,000 x 4.46%last year =$1,784

$40,000

$510,000 in deductions

c. in addition to the $550,000 of office furniture, Harry Corp. also acquired and placed in service $1,890,000 factory equipment during the year.

Under the expensing provision where their assets now total $2,440,000, Harry Corp.'s Section 179 expensing limitation is reduced to $100,000 [$510,000 - ($2,440,000 - $2,030,000)].The $410,000 disallowed by the limitation cannot be carried forward to 2018 either.