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Posted on Jul 27, 2024

Required Information Problem 10-56 (LO 10-2, LO 10-3) The following information applies to the questions displayed below.] AMP Corporation (calendar-year-end) has 2019 taxable income of

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Required Information Problem 10-56 (LO 10-2, LO 10-3) The following information applies to the questions displayed below.] AMP Corporation (calendar-year-end) has 2019 taxable income of $1,900,000 for purposes of computing the $179 expense. During 2019, AMP acquired the following assets: (Use MACRS Table 1. Table 2. Table 3, Table 4 and Table 5.) Asset Machinery Computer equipment Office building Total Placed in Service September 12 February 10 April 2 Basis $ 1,410,000 425,000 540,000 $ 2,375,000 Problem 10-56 Part a a. What is the maximum amount of $179 expense AMP may deduct for 2019? Maximum $179 expense deductible 737 Table 1 MACRS Half-Year Convention Depreciation Rate for Recovery Period 3-Year 5-Year 7-Year 10-Year 15-Year Year 1 3 3.33 20.00% 14.299 10.00% 5.00% Year 2 4 4.45 32.00 124.49 18.00 9.50 Year 3 14.81 19.20 17.491 14.40 8.55 Year 4 7 .41 11.52 12.49 11.52 7.70 Year 6 11.32 8 .03 19.22 6.93 Year 6 5.76 8.92 6.23 Year 7 8.93 6.55 5.90 Year 3 4.46 6.55 5.90 Year 9 16.56 5.91 Year 10 6.55 5.90 Year 11 3.28 5.91 Year 12 5.90 Year 13 Year 14 5.90 Year 15 TTTT 5.91 Year 16 2.95 Year 17 Year 19 Year 19 Year 20 Year 21 20-Year 3.750% 1219 6.677 6.179 5.713 5.285 4.888 4.522 4.462 4.461 4.462 4.461 4.462 4.461 4 462 4.461 4.462 4.461 4.462 4 461 5.91 2.231 TABLE 2 MACRS Mid-Quarter Convention: For property placed in service during the first quarter Depreciation Rate for Recovery Period 5-Year 7-Year Year 1 3 5.00% 25.00% Year 2 26.00 21.43 Year 3 15.60 15.31 Year 4 11.01 10.93 Year 5 11.01 8.75 Year 6 1 1.38 8.74 Year 7 8.75 Years 1.09 TABLE 26 MACRS Mid-Quarter Convention: For property placed in service during the second quarter Depreciation Rate for Recovery Period 5-Year 7-Year Year 1 2 5.00% 17.85% Year 2 30.00 23.47 Year 3 18.00 16.76 Year 4 11.37 Year 6 11.37 3.87 Year 6 4 .26 8.87 Year 7 8.87 Years TABLE 2 MACRS Mid-Quarter Convention: For propers placed in service during the third quarter Depreciation Rate for Recovery Period 5-Year 7-Year Year! 15.00% 10.71% Year 2 34.00 25.51 Year 3 20.40 18.22 Year 4 12.24 13.02 Year 5 11.30 9.30 Year 6 7.06 8.85 Year 7 8.86 Years TABLE 2d MACRS-Aid Quarter Convention: For property placed in service during the fourth quarter Depreciation Rate for Recovery Period 5-Year 1 7-Year Year 1 5.00% 3.57% Year 2 33.00 2755 Year 3 22.80 | 19.68 Year 4 13.68 14.06 Years 10.94 10.04 Year 6 9.58 8.13 Year 7 3.73 Years 764 SS3 TABLE 3 Residential Rental Property Afid-Month Convention Straight Line-27.5 Years Month Property Placed in Service Month 1 Month 2 Month 3 Month 4 Month 5 Month 6 Month 7 Month 3 Month 9 Month 10 Month 11 Month 12 Year 1 3 .485% 3.182% 2.879% 2.576% 2.273 1.970% 1.667% 1.3649 1.061% 0.758% 0.455% 0.152% Year 2-9 3.6363.6361 3.6363.6363.6363.6363.6363.6363.6363.636 1 3.6363.636 Year 10 3.637 3.6373.6373.637 3.6373.6373.6363.6363.6363.6363.6363.636 Year 11 3.636 3.636 13.636 3.636 3.6363.636 3.6373.6373.637 3.6373 .637 3.637 Year 12 3.6373.6373.6373.637 3.6373.6373.6363.6363.6363.6363.6363.636 Year 13 3.636 3.636 3 .636 3.636 3.636 3.636 3.637 3.637 1 3.637 3.637 3.637 3.637 Year 14 3.637 3.6373.6373.6373.637 3.6373.6363.6363.636 3.6363.6363.636 Year 15 3.6361 3.636 13.636 3.636 3.6363.636 3.637 3.6373.637 3.637 3 .637 3.637 Year 163.6373.6373.6373.6373.6373.6373.6363.6363.6363.6363.6363.636 Year 17 3.636 1 3.636 3.636 3.636 3.636 3.636 3.637 3.637 1 3.637 3.637 3.637 3.637 Year 18 3.637 3.6373.6373.637 3.637 3.6373.6363.6363.6363.6363.636 3.636 Year 19 3.636 3.636 13 .636 3.636 3.636 3.636 3.637 3.637 3 .637 3.637 3.637 3.637 Year 20 3.6373.6373.6373.637 3.6373.6373.6363.6363.6363.6363.6363.636 Year 21 3.636 3.636 3 .636 3.636 3.636 3.636 3.637 3.637 1 3.637 3.637 3.637 3.637 Year 22 3.637 3.6373.6373.6373.637 3.6373.6363.6363.636 3.6363.6363.636 Year 23 3.6361 3.636 13.6363.636 3.6363.636 3.637 3.6373.637 3.637 3.637 3.637 Year 24 3.6373 .6373.6373.6373.6373.6373.6363.6363.6363.6363.6363.636 Year 25 3.636 1 3.636 3.636 3.636 3 .636 3.636 3.637 3.637 3.637 3.637 3.637 3.637 Year 26 3.637 3.6373.6373.637 3.6373.6373.6363.6363.6363.6363.6363.636 Year 27 3.636 3.636 13 .636 3.636 3.636 3.636 3.637 3.637 3 .637 3.637 3.637 3.637 Year 28 1.97 2.2732.576 2.879 3.182 3.485 3.6363.6363.6363.6363.6363.636 Year 29 1 0.152 0.455 0.758 1.061 1.364 1.667 TABLE 4 Nonresidential Real Property Mid-Month Convention Straight Line-31.5 Years (for assets placed in service before May 13, 1993) Month 10 0.661% 3.175 3.175 1 1 Month 12 0.132 3.175 3.175 3.175 3.175 3.174 3.174 1 1 3.114 Month 1 Year 1 3.042% Year 2-7 3.175 Year 8 3.175 Year 9 3.174 Year 10 3.175 Year 113 .174 Year 12 3.175 Year 133 .174 Year 14 3.175 Year 153 .174 Year 16 3.175 Year 173 .174 Year 18 3.175 Year 19 Year 20 3.175 Year 213 .174 Year 22 3.175 Year 23 3.174 Year 24 3.175 Year 25 3174 Year 26 3.175 Year 27 3.174 Year 28 3.175 Year 293 .174 Year 303 .175 Year 31 3.174 Year 32 1.720 Year 33 Month 2 2.778% 3.175 3.174 3.175 3.174 3.175 3.174 3.175 3.174 3.175 3.174 3.175 3.174 3.175 3.174 3.175 3.174 3.175 3.174 3.175 3.174 3.175 3.174 3.175 3.174 3.175 1.984 Month 3 2.513% 3.175 3.175 3.174 3.175 3.174 3.175 3.174 3.175 3.174 3.175 3.174 3.175 3.174 3.175 3.174 3.175 3.174 3.175 3.174 3.175 3.174 3.175 3.174 3.175 3.174 2.249 Month 4 2.249% 3.175 3.174 3.175 3.174 3.175 3.174 3.175 3.174 3.175 3.174 3.175 3.174 3.175 3.174 3.175 3.174 3.175 3.174 3.175 3.174 3.175 3.174 3.175 3.174 3.175 2.513 |||||||||||||||||| Month Property Placed in Service Month 3 Month 6 Month 7 1 Month 3 1.9849 1.720% 1.455% 1.190 3.175 1 3.175 1 3.175 3.175 3.175 1 3 .174 3.175 3.175 3.174 3.175 3.174 3.175 3.175 3.174 3.175 3.174 3.174 3.175 3.174 3.175 3.175 3.174 3.175 3.174 3.174 3.175 3.174 3.175 3.175 3.174 3.175 3.174 3.174 3.175 3.174 3.175 3.175 3.174 3.175 1 3.174 3.174 3.174 3.175 3.175 3.174 3.175 3.174 3.174 3.175 3.174 3.175 3.175 3.174 3.175 3.174 3.174 3.175 3.175 3.175 3.174 3.175 3.174 3.174 3.175 3.174 3.115 3.175 3.174 3.175 1 3.174 3.174 3.175 3.174 3.175 3.175 3.174 3.175 3.174 3.174 3.175 3.174 3.175 3.175 3.174 3.175 3.174 3.174 3.175 3.174 3.175 3.175 3.174 3.175 3.174 3.174 3.175 3.174 3.175 2.778 1 3 .042 3.175 3.174 0.132 0.397 Month 9 0.926% 3.175 3.175 3.174 3.175 3.174 3.175 3.174 3.175 3.174 3.175 174 3.175 3.174 3.175 3.174 3.175 3.174 3.175 3.174 3.175 3.174 3.175 3.174 3.175 3.174 3.175 0.661 3.1743.175 3.174 3.175 .174 3.175 Month 11 0.397% 3.175 3.175 3.174 3.175 3.174 3.175 3.174 3.175 3.174 3.175 3.174 3.175 3.174 3.175 3.174 3.175 3.174 3.175 3.174 3.175 3.174 3.175 3.174 3.175 3.174 3.175 1.190 3.174 3.175 3.174 3.175 3.174 3.175 3.174 3.175 3.174 3.175 3.174 3.175 3.174 3.175 3.174 3.175 3.174 3.175 3.174 3.175 3.174 3.175 3.174 0.926 1 3.175 3.175 3.174 3.175 3.174 3.1975 3.174 3.175 3.174 3.175 3.174 3.175 3.174 3.1975 3.174 3.175 1 3,175 3.174 3.175 3.174 3.175 3.174 3.175 3.174 1.455 TABLE 5 Nonresidential Real Property Mid-Month Convention Straight Line-39 Years (for assets placed in service on or after May 13, 1993) Month 1 Yearl 2.461% Year 2-39 2.564 Year 400 .107 Month 2 2.247% 2.564 0.321 Month 3 2.0339 2.564 0.535 Month 4 1.819% 2.564 0.749 Month Property Placed in Service Month 5 Month 6 Month 7 1.605% 1.391% 1.177% 2.564 2.564 2.564 0.963 1.177 1 .391 Month 8 0.963% 2.564 1.605 Month 9 0.749% 2.564 1.819 Month 10 0.535% 2.564 2.033 Month 11 0.321% 2.564 2.247 Month 12 0.107% 2.564 2.461 1 1 Required Information Problem 10-56 (LO 10-2, LO 10-3) The following information applies to the questions displayed below.] AMP Corporation (calendar-year-end) has 2019 taxable income of $1,900,000 for purposes of computing the $179 expense. During 2019, AMP acquired the following assets: (Use MACRS Table 1. Table 2. Table 3, Table 4 and Table 5.) Asset Machinery Computer equipment Office building Total Placed in Service September 12 February 10 April 2 Basis $ 1,410,000 425,000 540,000 $ 2,375,000 Problem 10-56 Part b b. What is the maximum total depreciation, including S179 expense, that AMP may deduct in 2019 on the assets it placed in service in 2019, assuming no bonus depreciation? (Round your Intermediate calculations to the nearest whole dollar amount.) Maximum total depreciation (including $179 expense) Required Information Problem 10-56 (LO 10-2, LO 10-3) The following information applies to the questions displayed below.] AMP Corporation (calendar-year-end) has 2019 taxable income of $1,900,000 for purposes of computing the $179 expense. During 2019, AMP acquired the following assets: (Use MACRS Table 1. Table 2. Table 3, Table 4 and Table 5.) Asset Machinery Computer equipment Office building Total Placed in Service September 12 February 10 April 2 Basis $ 1,410,000 425,000 540,000 $ 2,375,000 Problem 10-56 Part a a. What is the maximum amount of $179 expense AMP may deduct for 2019? Maximum $179 expense deductible 737 Table 1 MACRS Half-Year Convention Depreciation Rate for Recovery Period 3-Year 5-Year 7-Year 10-Year 15-Year Year 1 3 3.33 20.00% 14.299 10.00% 5.00% Year 2 4 4.45 32.00 124.49 18.00 9.50 Year 3 14.81 19.20 17.491 14.40 8.55 Year 4 7 .41 11.52 12.49 11.52 7.70 Year 6 11.32 8 .03 19.22 6.93 Year 6 5.76 8.92 6.23 Year 7 8.93 6.55 5.90 Year 3 4.46 6.55 5.90 Year 9 16.56 5.91 Year 10 6.55 5.90 Year 11 3.28 5.91 Year 12 5.90 Year 13 Year 14 5.90 Year 15 TTTT 5.91 Year 16 2.95 Year 17 Year 19 Year 19 Year 20 Year 21 20-Year 3.750% 1219 6.677 6.179 5.713 5.285 4.888 4.522 4.462 4.461 4.462 4.461 4.462 4.461 4 462 4.461 4.462 4.461 4.462 4 461 5.91 2.231 TABLE 2 MACRS Mid-Quarter Convention: For property placed in service during the first quarter Depreciation Rate for Recovery Period 5-Year 7-Year Year 1 3 5.00% 25.00% Year 2 26.00 21.43 Year 3 15.60 15.31 Year 4 11.01 10.93 Year 5 11.01 8.75 Year 6 1 1.38 8.74 Year 7 8.75 Years 1.09 TABLE 26 MACRS Mid-Quarter Convention: For property placed in service during the second quarter Depreciation Rate for Recovery Period 5-Year 7-Year Year 1 2 5.00% 17.85% Year 2 30.00 23.47 Year 3 18.00 16.76 Year 4 11.37 Year 6 11.37 3.87 Year 6 4 .26 8.87 Year 7 8.87 Years TABLE 2 MACRS Mid-Quarter Convention: For propers placed in service during the third quarter Depreciation Rate for Recovery Period 5-Year 7-Year Year! 15.00% 10.71% Year 2 34.00 25.51 Year 3 20.40 18.22 Year 4 12.24 13.02 Year 5 11.30 9.30 Year 6 7.06 8.85 Year 7 8.86 Years TABLE 2d MACRS-Aid Quarter Convention: For property placed in service during the fourth quarter Depreciation Rate for Recovery Period 5-Year 1 7-Year Year 1 5.00% 3.57% Year 2 33.00 2755 Year 3 22.80 | 19.68 Year 4 13.68 14.06 Years 10.94 10.04 Year 6 9.58 8.13 Year 7 3.73 Years 764 SS3 TABLE 3 Residential Rental Property Afid-Month Convention Straight Line-27.5 Years Month Property Placed in Service Month 1 Month 2 Month 3 Month 4 Month 5 Month 6 Month 7 Month 3 Month 9 Month 10 Month 11 Month 12 Year 1 3 .485% 3.182% 2.879% 2.576% 2.273 1.970% 1.667% 1.3649 1.061% 0.758% 0.455% 0.152% Year 2-9 3.6363.6361 3.6363.6363.6363.6363.6363.6363.6363.636 1 3.6363.636 Year 10 3.637 3.6373.6373.637 3.6373.6373.6363.6363.6363.6363.6363.636 Year 11 3.636 3.636 13.636 3.636 3.6363.636 3.6373.6373.637 3.6373 .637 3.637 Year 12 3.6373.6373.6373.637 3.6373.6373.6363.6363.6363.6363.6363.636 Year 13 3.636 3.636 3 .636 3.636 3.636 3.636 3.637 3.637 1 3.637 3.637 3.637 3.637 Year 14 3.637 3.6373.6373.6373.637 3.6373.6363.6363.636 3.6363.6363.636 Year 15 3.6361 3.636 13.636 3.636 3.6363.636 3.637 3.6373.637 3.637 3 .637 3.637 Year 163.6373.6373.6373.6373.6373.6373.6363.6363.6363.6363.6363.636 Year 17 3.636 1 3.636 3.636 3.636 3.636 3.636 3.637 3.637 1 3.637 3.637 3.637 3.637 Year 18 3.637 3.6373.6373.637 3.637 3.6373.6363.6363.6363.6363.636 3.636 Year 19 3.636 3.636 13 .636 3.636 3.636 3.636 3.637 3.637 3 .637 3.637 3.637 3.637 Year 20 3.6373.6373.6373.637 3.6373.6373.6363.6363.6363.6363.6363.636 Year 21 3.636 3.636 3 .636 3.636 3.636 3.636 3.637 3.637 1 3.637 3.637 3.637 3.637 Year 22 3.637 3.6373.6373.6373.637 3.6373.6363.6363.636 3.6363.6363.636 Year 23 3.6361 3.636 13.6363.636 3.6363.636 3.637 3.6373.637 3.637 3.637 3.637 Year 24 3.6373 .6373.6373.6373.6373.6373.6363.6363.6363.6363.6363.636 Year 25 3.636 1 3.636 3.636 3.636 3 .636 3.636 3.637 3.637 3.637 3.637 3.637 3.637 Year 26 3.637 3.6373.6373.637 3.6373.6373.6363.6363.6363.6363.6363.636 Year 27 3.636 3.636 13 .636 3.636 3.636 3.636 3.637 3.637 3 .637 3.637 3.637 3.637 Year 28 1.97 2.2732.576 2.879 3.182 3.485 3.6363.6363.6363.6363.6363.636 Year 29 1 0.152 0.455 0.758 1.061 1.364 1.667 TABLE 4 Nonresidential Real Property Mid-Month Convention Straight Line-31.5 Years (for assets placed in service before May 13, 1993) Month 10 0.661% 3.175 3.175 1 1 Month 12 0.132 3.175 3.175 3.175 3.175 3.174 3.174 1 1 3.114 Month 1 Year 1 3.042% Year 2-7 3.175 Year 8 3.175 Year 9 3.174 Year 10 3.175 Year 113 .174 Year 12 3.175 Year 133 .174 Year 14 3.175 Year 153 .174 Year 16 3.175 Year 173 .174 Year 18 3.175 Year 19 Year 20 3.175 Year 213 .174 Year 22 3.175 Year 23 3.174 Year 24 3.175 Year 25 3174 Year 26 3.175 Year 27 3.174 Year 28 3.175 Year 293 .174 Year 303 .175 Year 31 3.174 Year 32 1.720 Year 33 Month 2 2.778% 3.175 3.174 3.175 3.174 3.175 3.174 3.175 3.174 3.175 3.174 3.175 3.174 3.175 3.174 3.175 3.174 3.175 3.174 3.175 3.174 3.175 3.174 3.175 3.174 3.175 1.984 Month 3 2.513% 3.175 3.175 3.174 3.175 3.174 3.175 3.174 3.175 3.174 3.175 3.174 3.175 3.174 3.175 3.174 3.175 3.174 3.175 3.174 3.175 3.174 3.175 3.174 3.175 3.174 2.249 Month 4 2.249% 3.175 3.174 3.175 3.174 3.175 3.174 3.175 3.174 3.175 3.174 3.175 3.174 3.175 3.174 3.175 3.174 3.175 3.174 3.175 3.174 3.175 3.174 3.175 3.174 3.175 2.513 |||||||||||||||||| Month Property Placed in Service Month 3 Month 6 Month 7 1 Month 3 1.9849 1.720% 1.455% 1.190 3.175 1 3.175 1 3.175 3.175 3.175 1 3 .174 3.175 3.175 3.174 3.175 3.174 3.175 3.175 3.174 3.175 3.174 3.174 3.175 3.174 3.175 3.175 3.174 3.175 3.174 3.174 3.175 3.174 3.175 3.175 3.174 3.175 3.174 3.174 3.175 3.174 3.175 3.175 3.174 3.175 1 3.174 3.174 3.174 3.175 3.175 3.174 3.175 3.174 3.174 3.175 3.174 3.175 3.175 3.174 3.175 3.174 3.174 3.175 3.175 3.175 3.174 3.175 3.174 3.174 3.175 3.174 3.115 3.175 3.174 3.175 1 3.174 3.174 3.175 3.174 3.175 3.175 3.174 3.175 3.174 3.174 3.175 3.174 3.175 3.175 3.174 3.175 3.174 3.174 3.175 3.174 3.175 3.175 3.174 3.175 3.174 3.174 3.175 3.174 3.175 2.778 1 3 .042 3.175 3.174 0.132 0.397 Month 9 0.926% 3.175 3.175 3.174 3.175 3.174 3.175 3.174 3.175 3.174 3.175 174 3.175 3.174 3.175 3.174 3.175 3.174 3.175 3.174 3.175 3.174 3.175 3.174 3.175 3.174 3.175 0.661 3.1743.175 3.174 3.175 .174 3.175 Month 11 0.397% 3.175 3.175 3.174 3.175 3.174 3.175 3.174 3.175 3.174 3.175 3.174 3.175 3.174 3.175 3.174 3.175 3.174 3.175 3.174 3.175 3.174 3.175 3.174 3.175 3.174 3.175 1.190 3.174 3.175 3.174 3.175 3.174 3.175 3.174 3.175 3.174 3.175 3.174 3.175 3.174 3.175 3.174 3.175 3.174 3.175 3.174 3.175 3.174 3.175 3.174 0.926 1 3.175 3.175 3.174 3.175 3.174 3.1975 3.174 3.175 3.174 3.175 3.174 3.175 3.174 3.1975 3.174 3.175 1 3,175 3.174 3.175 3.174 3.175 3.174 3.175 3.174 1.455 TABLE 5 Nonresidential Real Property Mid-Month Convention Straight Line-39 Years (for assets placed in service on or after May 13, 1993) Month 1 Yearl 2.461% Year 2-39 2.564 Year 400 .107 Month 2 2.247% 2.564 0.321 Month 3 2.0339 2.564 0.535 Month 4 1.819% 2.564 0.749 Month Property Placed in Service Month 5 Month 6 Month 7 1.605% 1.391% 1.177% 2.564 2.564 2.564 0.963 1.177 1 .391 Month 8 0.963% 2.564 1.605 Month 9 0.749% 2.564 1.819 Month 10 0.535% 2.564 2.033 Month 11 0.321% 2.564 2.247 Month 12 0.107% 2.564 2.461 1 1 Required Information Problem 10-56 (LO 10-2, LO 10-3) The following information applies to the questions displayed below.] AMP Corporation (calendar-year-end) has 2019 taxable income of $1,900,000 for purposes of computing the $179 expense. During 2019, AMP acquired the following assets: (Use MACRS Table 1. Table 2. Table 3, Table 4 and Table 5.) Asset Machinery Computer equipment Office building Total Placed in Service September 12 February 10 April 2 Basis $ 1,410,000 425,000 540,000 $ 2,375,000 Problem 10-56 Part b b. What is the maximum total depreciation, including S179 expense, that AMP may deduct in 2019 on the assets it placed in service in 2019, assuming no bonus depreciation? (Round your Intermediate calculations to the nearest whole dollar amount.) Maximum total depreciation (including $179 expense)