Pete's Garage just purchased some equipment at a cost of $650,000. What is the proper methodology for computing the depreciation expense for Year 3 if the equipment is classified as 5-year property for MACRS? The MACRS rates are 20 percent, 32 percent, 19.2 percent, 11.52 percent, 11.52 percent, and 5.76 percent for Years 1 to 6, respectively. Ignore bonus depreciation.

Group of answer choices

$650,000(1 .20)(1 .32)

$650,000(.192)

$650,000(1 .20)(1 .32)(.192)

$650,000(1 .20)(1 .32)(1 .192)

$650,000(1 .192)