Question
In January 20XX, JIM, purchased $350,000 of new MACRS (Modified Accelerated Cost Recovery System) 5-year property in the United States. This equipment was placed in
In January 20XX, JIM, purchased $350,000 of new MACRS (Modified Accelerated Cost Recovery System) 5-year property in the United States. This equipment was placed in service May 1, 20XX. JIM wants to take as much depreciation in 20XX as possible.
- Calculate the depreciation for 20XX.
- IfJIMhadbeenlocatedinaqualifiedenterprisezone,whatwouldbethedepreciationamount?
- Explainthedepreciationmethodyouused.
include the tax benefits (savings) for the first year and the present value of the total tax benefits for the entire 5-year period.
- Discuss how the tax benefits and present value would change if a different method of depreciation was used.
- Also, discuss when JIM would not choose to take as much depreciation as possible.
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Operations management processes and supply chain
Authors: Lee J Krajewski, Larry P Ritzman, Manoj K Malhotra
9th edition
9788131728840, 136065767, 8131728846, 978-0136065760
