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M. Stone Corp. is a technology start-up company in its second year of operations. The company didn't purchase any assets this year but purchased the
M. Stone Corp. is a technology start-up company in its second year of operations. The company didn't purchase any assets this year but purchased the following assets in the prior year:
Asset | Placed in Service | Basis |
Office Equipment | August 14 | $10,000 |
Manufacturing equipment | April 15 | 68,000 |
Computer System | Jun 1 | 16,000 |
Total | $94,000 |
M. Stone did not know depreciation was tax deductible until it hired an accountant this year and didn't claim any depreciation deduction in its first year of operation.
a) What is the maximum amount of depreciation deduction M. Stone can deduct in its second year of operation?
b) What is the basis of the office equipment at the end of the second year?
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