Please work out each problem step by steps

1.MACRS with Trade-In: In May 2011, your company traded in a computer and peripheral equipment, used in its business, that had a BV at that time of $25,000. A new, faster computer system having a fair market value of $300,000 was acquired. Because the vendor accepted the older computer as a trade-in, a deal was agreed to whereby your company would pay $225,000 cash for the new computer system. a. What is the property class life and recovery year for the computer system? b. Using MACRS GDS rates, how much depreciation can be deducted each year based on this class life? 2. The La Salle Bus Company has decided to purchase a new bus for $95,000 with a trade-in of their old bus. The old bus has a BV of $10,000 at the time of the trade-in. The new bus will be kept for 10 years before being sold. Its estimated SV at that time is expected to be $15,000. a. Determine which asset class of the bus. b. Determine annual Straight-Line Depreciation charge. TABLE 11-1 Example Class LIVLJUM MACRS Property Class (years) Class Life (years) ADR GDS ADS 7 15 7.5 10 16 IRS Asset Class Asset Description 00.11 Office furniture, fixtures, and equipment 00.12 Information systems: computers/peripheral 00.22 Automobiles, taxis 00.241 Light general-purpose trucks 00.25 Railroad cars and locomotives 00.40 Industrial steam and electric distribution 01.11 Cotton gin assets 01.21 Catife, breeding or dairy 13.00 Offshore drilling assets 13.30 Petroleum refining assets 15.00 Construction assets 20.10 Manufacture of grain and grain mill products 22.2 Manufacture of yarn, thread, and woven fabric 24.10 Cutting of timber 32.20 Manufacture of cement 37.11 Manufacture of motor vehicles 48.11 Telephone communications assets and buildings 48.2 Radio and television broadcasting equipment 49.12 Electric utility nuclear production plant 49.13 Electric utility steam production plant 49.23 Natural gas production plant 50.00 Municipal wastewater treatment plant 80.00 Theme and amusement park assets See Table BI Table of Cla n 10 7 17 11 15 7 15 20 12 24 24 12.5