Problem 8-33 (b) (LO. 2)

Starnell acquired the following new assets during 2020:

Date Asset January Computers and peripheral 4 equipment Truck (not subject to any June2 _ _ _ _ _ depreciation limitations) October Office e ui ment 31 q p Starnell does not elect immediate expensing under 179 but elects additional rst-year depreciation for the computers. If required, round your answers to the nearest dollar. Click here to access the depreciation table to use for this problem. a. What MACRS convention applies to the assets? Mid-quarter J b. What class of property is each asset for MACRS? Office equipment, seven-year; truck, five-year; computers and peripheral equipment, five-year J c. The cost recovery for the current year is: Computers and peripheral equipment: Truck: Office equipment: Feedback v Check My Work Under the modied accelerated cost recovery system (MACRS), the cost of an asset is recovered over a predetermined period that is generally shorter than the useful life of the asset or the period the asset is used to produce income. MACRS provides separate cost recovery tables for realty (real property) and personalty (personal property). MACRS provides that the cost recovery basis of eligible personalty (and certain realty) is recovered over 3, 5, 7, 10, 15, or 20 years