Required information [The following information applies to the questions displayed below.) Karane Enterprises, a calendar-year manufacturer based in College Station, Texas, began business in 2018. In the process of setting up the business, Karane has acquired various types of assets. Below is a list of assets acquired during 2018: Asset office furniture Machinery Used delivery trucke Cost $ 150,000 1.550.000 40.000 Date placed in Service 02/03/2018 07/22/2018 08/17/2018 "Not considered a luxury automobile. During 2018, Karane was very successful and had no 5179 limitations) and decided to acquire more assets in 2019 to increase its production capacity. These are the assets acquired during 2019: $ Asset Computers & Info. System Luxury autot Assembly equipment storage building Cost 400,000 80,000 1,200,000 700,000 Date Placed in Service 03/31/2019 05/26/2019 08/15/2019 11/13/2019 Used 100% for business purposes. Karane generated taxable income in 2019 of $1,732,500 for purposes of computing the $179 expense. (Use MACRS Table 1. Table 2. Table 3. Table 4. Table 5, and Exhibit 10.10.) Assume the 2018 5179 limits are the same as those in 2019 (Leave no answer blank. Enter zero if applicable. Input all the values as positive numbers.) c. Compute the maximum 2019 depreciation deductions, including 5179 expense, but now assume that karane would like to take bonus depreciation c. Compute the maximum 2019 depreciation deductions, including $179 expense, but now assume that Karane would like to ta bonus depreciation. Description Cost Sec. 179 Expense Bonus MACRS Basis Current MACRS Depreciation Total Depreciation Deduction 2018 Assets Office furniture Machinery Used delivery truck ME 2019 Assets Computers & Info System Luxury Auto Assembly Equipment Storage Building Totals OSOSOS OS of Table 1 MACRS Half-Year Convention Depreciation Rate for Recovery Period 3-Year 5-Year 7-Year 10-Year 15-Year Year 1 1 33.33% 20,00% 14.29% 10.00% 5.00% Year 2 44.45 32.00 24.49 18.00 9.50 Year 3 14.81 19.20 17.49 14.40 8.55 Year 4 7.41 11.52 12.49 11.52 7.70 Year 5 11.52 893 9.22 6.93 Year 6 5.76 8.92 7:37 6.23 Year 7 8.93 6.55 5.90 Year 8 4.46 6.55 5.90 Year 9 6.56 5.91 Year 10 6.55 5.90 Year 11 3.28 Year 12 5.90 Year 13 5.91 Year 14 5.90 Year 15 5.91 Year 16 Year 17 Year 18 Year 19 Year 20 Year 21 20-Year 3.750% 7.219 6.677 6.177 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 2.231 5.91 2.95 EXHIBIT 10-10 Automobile Depreciation Limits Recovery Year 1 Recovery Year 2 Recovery Year 3 Recovery Year 4 and after 2019* 10,000** 16,000 9,600 5,760 Year Placed in Service | 2018 2017 10,000+ 3,160* 16,000 5,100 9,600 3,050 5 ,760 1,875 2016 3,160* 5,100 3,050 1,875 *As of press date, the IRS had not released the 2019 limitations for automobiles, so throughout the chapter we **$8,000 additional depreciation is allowed when bonus depreciation is claimed (8168(k)(2)(F). Required information [The following information applies to the questions displayed below.) Karane Enterprises, a calendar-year manufacturer based in College Station, Texas, began business in 2018. In the process of setting up the business, Karane has acquired various types of assets. Below is a list of assets acquired during 2018: Asset office furniture Machinery Used delivery trucke Cost $ 150,000 1.550.000 40.000 Date placed in Service 02/03/2018 07/22/2018 08/17/2018 "Not considered a luxury automobile. During 2018, Karane was very successful and had no 5179 limitations) and decided to acquire more assets in 2019 to increase its production capacity. These are the assets acquired during 2019: $ Asset Computers & Info. System Luxury autot Assembly equipment storage building Cost 400,000 80,000 1,200,000 700,000 Date Placed in Service 03/31/2019 05/26/2019 08/15/2019 11/13/2019 Used 100% for business purposes. Karane generated taxable income in 2019 of $1,732,500 for purposes of computing the $179 expense. (Use MACRS Table 1. Table 2. Table 3. Table 4. Table 5, and Exhibit 10.10.) Assume the 2018 5179 limits are the same as those in 2019 (Leave no answer blank. Enter zero if applicable. Input all the values as positive numbers.) c. Compute the maximum 2019 depreciation deductions, including 5179 expense, but now assume that karane would like to take bonus depreciation c. Compute the maximum 2019 depreciation deductions, including $179 expense, but now assume that Karane would like to ta bonus depreciation. Description Cost Sec. 179 Expense Bonus MACRS Basis Current MACRS Depreciation Total Depreciation Deduction 2018 Assets Office furniture Machinery Used delivery truck ME 2019 Assets Computers & Info System Luxury Auto Assembly Equipment Storage Building Totals OSOSOS OS of Table 1 MACRS Half-Year Convention Depreciation Rate for Recovery Period 3-Year 5-Year 7-Year 10-Year 15-Year Year 1 1 33.33% 20,00% 14.29% 10.00% 5.00% Year 2 44.45 32.00 24.49 18.00 9.50 Year 3 14.81 19.20 17.49 14.40 8.55 Year 4 7.41 11.52 12.49 11.52 7.70 Year 5 11.52 893 9.22 6.93 Year 6 5.76 8.92 7:37 6.23 Year 7 8.93 6.55 5.90 Year 8 4.46 6.55 5.90 Year 9 6.56 5.91 Year 10 6.55 5.90 Year 11 3.28 Year 12 5.90 Year 13 5.91 Year 14 5.90 Year 15 5.91 Year 16 Year 17 Year 18 Year 19 Year 20 Year 21 20-Year 3.750% 7.219 6.677 6.177 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 2.231 5.91 2.95 EXHIBIT 10-10 Automobile Depreciation Limits Recovery Year 1 Recovery Year 2 Recovery Year 3 Recovery Year 4 and after 2019* 10,000** 16,000 9,600 5,760 Year Placed in Service | 2018 2017 10,000+ 3,160* 16,000 5,100 9,600 3,050 5 ,760 1,875 2016 3,160* 5,100 3,050 1,875 *As of press date, the IRS had not released the 2019 limitations for automobiles, so throughout the chapter we **$8,000 additional depreciation is allowed when bonus depreciation is claimed (8168(k)(2)(F)