Question
I need help determinging the section 179 depreciation, Bonus Depreciation MACRS base, and current MACRS depreciation Karane Enterprises, a calendar-year manufacturer based in College Station,
I need help determinging the section 179 depreciation, Bonus Depreciation MACRS base, and current MACRS depreciation
Karane Enterprises, a calendar-year manufacturer based in College Station, Texas, began business in 2018. In the process of setting up the business, Karane has acquired various types of assets. Below is a list of assets acquired during 2018:
Asset
Cost
Date Placed in Service
Office furniture
$150,000
02/03/2018
Machinery
$ 1,560,000
07/22/2018
Used delivery truck*
$ 40,000
08/17/2018
*Not considered a luxury automobile.
During 2018, Karane was very successful (and had no 179 limitations) and decided to acquire more assets in 2019 to increase its production capacity. These are the assets acquired during 2019:
Asset
Cost
Date Placed in Service
Computers & info. system
$ 400,000
03/31/2019
Luxury auto
$80,000
05/26/2019
Assembly equipment
$1,200,000
08/15/2019
Storage building
$700,000
11/13/2019
Used 100% for business purposes.
Karane generated taxable income in 2019 of $1,732,500 for purposes of computing the 179 expense.(UseMACRSTable 1,Table 2,Table 3,Table 4,Table 5, andExhibit 10-10.)(Leave no answer blank. Enter zero if applicable. Input all the values as positive numbers.)
rev: 10_25_2019_QC_CS-188019
d.Now assume that during 2019, Karane decides to buy a competitor's assets for a purchase price of $1,350,000. Compute the maximum 2019 cost recovery, including 179 expense and bonus depreciation. Karane purchased the following assets for the lump-sum purchase price.(Round your final answers to the nearest whole dollar amount.)
Asset
Cost
Date Placed in Service
Inventory
$ 220,000
09/15/2019
Office furniture
$230,000
09/15/2019
Machinery
$250,000
09/15/2019
Patent
$198,000
09/15/2019
Goodwill
$2,000
09/15/2019
Building
$430,000
09/15/2019
Land
20,000
09/15/2019
Asset
Cost
Section 179
Bonus Dep
MACRS base
Current dep
Total depreciation
I need help determinging the section 179 depreciation, Bonus Depreciation MACRS base, and current MACRS depreciation
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Fundamentals of Cost Accounting
Authors: William N. Lanen, Shannon Anderson, Michael W Maher
6th edition
1259969479, 1259565408, 978-1259969478
