Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

John and Mary are married. They own and operate J & M Restaurant as a family partnership. In2020, they traded in an oven used in

John and Mary are married. They own and operate J & M Restaurant as a family partnership. In2020, they traded in an oven used in their business with an adjusted basis of $1,200 for a new one costing $3,800. They were given $700 trade-in for the old oven and paid $3,100 cash for the new oven on July 15,2020. The new oven was placed in service in the restaurant on July 15,2020. They also purchased a new computer system for use in their business for $8,700. Although the new computer system was installed, ready, and available for use on December12,2020, John and Mary decided to finish out the year using the old computer system. The new computer system was first used in their business on January1,2021. Taxable income from the restaurant business before the Sec. 179 deduction was $490,000. What amount of Sec. 179 deduction can John and Mary claim if they file a joint return for2020and neither has any other Sec. 179 deductions?

A. $12500

B. $3100

C. $11800

D. $3800

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image_2

Step: 3

blur-text-image_3

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Financial Reporting And Analysis

Authors: Lawrence Revsine, Daniel Collins

4th Edition

0073527092, 978-0073527093

More Books

Students also viewed these Accounting questions

Question

Under SOX, who selects and hires the auditor?

Answered: 1 week ago

Question

5X+2

Answered: 1 week ago