ABC Enterprises, a calendar year manufacturer, began business in 2017. In the process of setting up the business, ABC has acquired various types of assets. Below is a list of assets acquired during 2017:

Asset---- Cost ------ Date Place in Service

Office furniture $150,000 02/03/2017

Machinery 1,560,000 07/22/2017

Used delivery truck* 40,000 08/17/2017 *Not considered a luxury automobile.

During 2017, ABC was very successful (and had no 179 limitations) and decided to acquire more assets this next year to increase its production capacity. These are the assets acquired during 2018:

Asset ----Cost ------Date Place in Service

Computers & Info. System $400,000 03/31/2018

Luxury Auto(used 100% for business purposes) 80,000 05/26/2018

Assembly Equipment 1,200,000 08/15/2018

Storage Building 700,000 11/13/2018

ABC generated taxable income in 2018 of $1,732,500 for purposes of computing the 179 expense.

Required

a. Compute the maximum 2018 depreciation deductions including 179 expense (ignoring bonus depreciation). Show all of your calculations.

b. Compute the maximum 2018 depreciation deductions including 179 expense, but now assume that ABC would like to take bonus depreciation. Show all of your calculations.

c. Complete Form 4562 for part a using the 2017 tax form. (Available at www.irs.gov)