Dain's Diamond Bit Drilling purchased the following assets this year

. Asset Purchase Date Original Basis

Drill bits (5-year) Jan-29 $92,000

Drill bits (5-year) Aug-11 103,750

Commercial building Jun-11 289,000

Assume its taxable income for the year was $75,500 for purposes of computing the 179 expense (assume no bonus depreciation).

a. What is the maximum amount of 179 expense Dain may deduct for the year?

b. What is Dain's maximum depreciation expense for the year (including 179 expense)?

c. If the January drill bits' original basis was $2,390,000, what is the maximum amount of 179 expense Dain may deduct for the year? d. If the January drill bits' basis was $2,510,000, what is the maximum amount of 179 expense Dain may deduct for the year?