Karane Enterprises, a calendar-year manufacturer based in College Station, Texas, began business in 2021. In the process of setting up the business, Karane has acquired various types of assets. Below is a list of assets acquired during 2021 : "Not considered a luxury automobile. During 2021, Karane was very successful (and had no $179 limitations) and decided to acquire more assets in 2022 to increase its production capacity. These are the assets acquired during 2022: "Used 100% for business purposes. Karane generated taxable income in 2022 of $1,785,000 for purposes of computing the 5179 expense limitation. (Use MACRS Table 1. Table 2. Table 3, Table 4. Table 5, and Exhibit 10-10) Note: Leave no answer blank, Enter zero if applicable. Input all the values as positive numbers. b. Compute the maximum 2022 depreciation deductions, including $179 expense (ignoring bonus depreciation). c. Compute the maximum 2022 depreciation deductions, including $179 expense, but now assume that Karane would like to tak bonus depreciation. d. Now assume that during 2022, Karane decides to buy a competitor's assets for a purchase price of $1,601,580. Compute the maximum 2022 cost recovery, including 5179 expense and bonus depreciation. Karane purchased the following assets for the lump. sum purchase price: Note: Round your final answers to the nearest whole dollar amount. Assume that Karane takes the maximum section 179 expense for the Assembly Equipment. Required: Compute the maximum 2021 depreciation deductions, including 5179 expense (lgnoring bonus depreciation) Table 1 MACRS Half:Year Convention TABLE 2a MACRS Mid-Quarter Convention: For properry placed in service during the first quarter. TABLE 2b MACRS Mid-Quarter Convention: For property placed in service during the second quarter TABLE 2e MACRS Mid-Quarter Convention: For property placed in service during the third quarter TABLE 2d MACRS-Mid Quarter Convention: For property placed in service during the fourth quarter TABTE 3 Residential Rental Property Mid-Month Convention Straisht Line -97 \& v. Menth Property Placed in Service TABLE 5 Nonredidenteal Real Froperty Mide-Menth Convention S4raight 1.ine - 99 Vears (for ascts placed in serrice on or after May 13, 1993) EXHIBIT 10-10 Automobile Depreciation Limits Tx of press date, the IRS had not released the 2022 limitarions for automobiles, 10 throughout the chapver we use the tame limitanions ax in 2021 for 2022. * $8,000 additional depreciation is allowed when bonas depreciation is claimed /S16e(k/2)(F)/. Karane Enterprises, a calendar-year manufacturer based in College Station, Texas, began business in 2021. In the process of setting up the business, Karane has acquired various types of assets. Below is a list of assets acquired during 2021 : "Not considered a luxury automobile. During 2021, Karane was very successful (and had no $179 limitations) and decided to acquire more assets in 2022 to increase its production capacity. These are the assets acquired during 2022: "Used 100% for business purposes. Karane generated taxable income in 2022 of $1,785,000 for purposes of computing the 5179 expense limitation. (Use MACRS Table 1. Table 2. Table 3, Table 4. Table 5, and Exhibit 10-10) Note: Leave no answer blank, Enter zero if applicable. Input all the values as positive numbers. b. Compute the maximum 2022 depreciation deductions, including $179 expense (ignoring bonus depreciation). c. Compute the maximum 2022 depreciation deductions, including $179 expense, but now assume that Karane would like to tak bonus depreciation. d. Now assume that during 2022, Karane decides to buy a competitor's assets for a purchase price of $1,601,580. Compute the maximum 2022 cost recovery, including 5179 expense and bonus depreciation. Karane purchased the following assets for the lump. sum purchase price: Note: Round your final answers to the nearest whole dollar amount. Assume that Karane takes the maximum section 179 expense for the Assembly Equipment. Required: Compute the maximum 2021 depreciation deductions, including 5179 expense (lgnoring bonus depreciation) Table 1 MACRS Half:Year Convention TABLE 2a MACRS Mid-Quarter Convention: For properry placed in service during the first quarter. TABLE 2b MACRS Mid-Quarter Convention: For property placed in service during the second quarter TABLE 2e MACRS Mid-Quarter Convention: For property placed in service during the third quarter TABLE 2d MACRS-Mid Quarter Convention: For property placed in service during the fourth quarter TABTE 3 Residential Rental Property Mid-Month Convention Straisht Line -97 \& v. Menth Property Placed in Service TABLE 5 Nonredidenteal Real Froperty Mide-Menth Convention S4raight 1.ine - 99 Vears (for ascts placed in serrice on or after May 13, 1993) EXHIBIT 10-10 Automobile Depreciation Limits Tx of press date, the IRS had not released the 2022 limitarions for automobiles, 10 throughout the chapver we use the tame limitanions ax in 2021 for 2022. * $8,000 additional depreciation is allowed when bonas depreciation is claimed /S16e(k/2)(F)/
