Need help with this assignment. It's a fixed asset assignment focusing on section 179 and depreciation.

Stephen Hopkins started a farm in the spring of 1621 in Plymouth, Massachusetts. He purchased 100 acres of land and a log home. The home site sits on 1 acre. The rest of the land is devoted to farming. To start his business, Stephen needed to purchase some assets. He purchased 2 oxen, a plow, various hand tools, and built a large barn. He also needed a vehicle that was able to haul large loads, a vehicle to get around town and transport his crops to market, and a vehicle to drive for personal purposes. In addition, he needed to furnish his farm office, which is in his home. He uses a spare room, which is one tenth of the square foot of the whole house, and that room is solely devoted to his business. Attached is a list of the assets Stephen purchased. While Stephen is an excellent farmer, he isn't much for paperwork. He is asking for your help to calculate the depreciation on his assets. He'd like to project four years into the future, so he wants you to calculate the depreciation for the first year, and the next three years. He wants to depreciate his assets on a tax basis, and of course, he wants to maximize his tax savings for the first year, so you should include Section 179 and bonus depreciation in your calculations, where either applies. The log home and land were purchased together of course, for a total price of $1,000. On examining the historical tax assessment (total assessed value $500), you notice that the land is assessed at $400 and the log home is assessed at $100. You should use the same proportion of land value and home value to total value to assign values to the purchase price. There were no utility costs to run the office, there was no mortgage on the property, and no real estate taxes were assessed. In fact, the only deduction for the office is the depreciation. After all, this is 1621, and the Mayflower passengers didn't have time their first winter to plug into the utility grid or build a county tax office before they started building in the spring. Use your professional judgment to depreciate the assets correctly based on the information supplied by your client. The Fixed Asset table is set up for you. All you have to do is fill in the blanks and calculate depreciation utilizing Excel functions.. Please round to the nearest dollar. Print it out (formatted to one page) and bring it to class with you on December 6. Also, please submit electronically through Blackboard. Both are due Tuesday, December 6 by class time. Please allow your mind to believe that in 1621 there was depreciation, and a federal government to pay tax to. Section 179 is limited to $100 in 1621(similar to the $500,000 limit in 2016) , with a total asset phase-out starting at $150 (similar to the $2,010,000 limit in 2016). Section 179 is of course subject to income limits; you cannot use Section 179 to create or extend a tax loss. In 1621, there is no Section 179 carryover. All other rules for Section 179 and fifty percent bonus depreciation are the same. Vehicles are limited to a cost recovery in the first year of $5, unless they are heavy duty work vehicles over a gross weight of 2000 pounds. If they are heavy duty and over the gross weight, regular depreciation rates will apply. Questions: What is/are the convention(s) applied to Stephen's assets? What is the total reduction of basis due to Section 179? What is the total depreciation amount, including bonus and Section 179, for the first and third years? Stephen Hopkins' Farm Assets Fixed Asset Listing with Depreciation For 1621 and projected Depreciation for: Asset Purchase Useful Life* date/Placed in (in Eligible for Eligible for Service years) Sect. 179? Bonus? Convention Cost Land $ 1,000 01/01/1621 Home $ - 01/01/1621 Office $ 20 06/30/1621 Ted Doty (ox) $ 20 6/30/1621 Ted Leister (ox) $ 25 9/30/1621 2500 lb. farm wagon $ 50 9/30/1621 surrey with a fringe on top $ 20 12/15/1621 unicycle $ 10 11/15/1621 Filing cabinet $ 10 12/15/1621 Desk chair $ 7 12/15/1621 desk $ 10 12/15/1621 Abacus $ 3 12/15/1621 ledger book $ 1 12/15/1621 Total $ 1,176 Depreciation Method Amount of Sect. 179 taken Amount of Bonus depreciation taken Depreciable basis - - - * Useful life by IRS guidelines Assumptions (this is not an all inclusive list of assumptions. It is only a starting point for your own assumptions.) 1. The surrey with the fringe is part personal, part farm. Personal use is 60%. 2. The oxen are not inventory, nor were any expenses deducted during the time they were being raised. 3. The farm had enough profit to take the Section 179. No loss was produced. 4. Listed property placed in service before 1987 rules do not apply. Year 1 total cost reovery Year 1 - - Year 2 Year 3 - Year 4