Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Required information [The following information applies to the questions displayed below.] DLW Corporation acquired and placed in service the following assets during the year: Assuming

image text in transcribedimage text in transcribedimage text in transcribedimage text in transcribedimage text in transcribedimage text in transcribed Required information [The following information applies to the questions displayed below.] DLW Corporation acquired and placed in service the following assets during the year: Assuming DLW does not elect \$179 expensing and elects not to use bonus depreciation, answer the following questions: (Use MACRS Table 1, Table 2, Table 3, Table 4 and Table 5.) Note: Do not round intermediate calculations. Round your final answers to the nearest whole dollar amount. a. What is DLW's year 1 cost recovery for each asset? Table 1 MACRS Half-Year Convention \begin{tabular}{|c|c|c|c|c|c|c|} \hline \multicolumn{7}{|c|}{ Depreciation Rate for Recovery Period } \\ \hline & 3-Year & 5-Year & 7-Year & 10-Year & 15-Year & 20-Year \\ \hline Year 1 & 33.33% & 20.00% & 14.29% & 10.00% & 5.00% & 3.750% \\ \hline Year 2 & 44.45 & 32.00 & 24.49 & 18.00 & 9.50 & 7.219 \\ \hline Year 3 & 14.81 & 19.20 & 17.49 & 14.40 & 8.55 & 6.677 \\ \hline Year 4 & 7.41 & 11.52 & 12.49 & 11.52 & 7.70 & 6.177 \\ \hline Year 5 & & 11.52 & 8.93 & 9.22 & 6.93 & 5.713 \\ \hline Year 6 & & 5.76 & 8.92 & 7.37 & 6.23 & 5.285 \\ \hline Year 7 & & & 8.93 & 6.55 & 5.90 & 4.888 \\ \hline Year 8 & & & 4.46 & 6.55 & 5.90 & 4.522 \\ \hline Year 9 & & & & 6.56 & 5.91 & 4.462 \\ \hline Year 10 & & & & 6.55 & 5.90 & 4.461 \\ \hline Year 11 & & & & 3.28 & 5.91 & 4.462 \\ \hline Year 12 & & & & & 5.90 & 4.461 \\ \hline Year 13 & & & & & 5.91 & 4.462 \\ \hline Year 14 & & & & & 5.90 & 4.461 \\ \hline Year 15 & & & & & 5.91 & 4.462 \\ \hline Year 16 & & & & & 2.95 & 4.461 \\ \hline Year 17 & & & & & & 4.462 \\ \hline Year 18 & & & & & & 4.461 \\ \hline Year 19 & & & & & & 4.462 \\ \hline Year 20 & & & & & & 4.461 \\ \hline Year 21 & & & & & & 2.231 \\ \hline \end{tabular} TABLE 2b MACRS Mid-Quarter Convention: For property placed in service during the second quarter TABLE 2c MACRS Mid-Quarter Convention: For property placed in service during the third quarter TABLE 2d MACRS-Mid Quarter Convention: For property placed in service during the fourth quarter TABLE 3 Residential Rental Property Mid-Month Convention Straight Line-27.5 Years \begin{tabular}{|c|c|c|c|c|c|c|c|c|c|c|c|c|} \hline \multicolumn{13}{|c|}{ Month Property Placed in Service } \\ \hline & Month 1 & Month 2 & Month 3 & Month 4 & Month 5 & Month 6 & Month 7 & Month 8 & Month 9 & Month 10 & Month 11 & Month 12 \\ \hline Year 1 & 3.485% & 3.182% & 2.879% & 2.576% & 2.273% & 1.970% & 1.667% & 1.364% & 1.061% & 0.758% & 0.455% & 0.152% \\ \hline Year 2-9 & 3.636 & 3.636 & 3.636 & 3.636 & 3.636 & 3.636 & 3.636 & 3.636 & 3.636 & 3.636 & 3.636 & 3.636 \\ \hline Year 10 & 3.637 & 3.637 & 3.637 & 3.637 & 3.637 & 3.637 & 3.636 & 3.636 & 3.636 & 3.636 & 3.636 & 3.636 \\ \hline Year 11 & 3.636 & 3.636 & 3.636 & 3.636 & 3.636 & 3.636 & 3.637 & 3.637 & 3.637 & 3.637 & 3.637 & 3.637 \\ \hline Year 12 & 3.637 & 3.637 & 3.637 & 3.637 & 3.637 & 3.637 & 3.636 & 3.636 & 3.636 & 3.636 & 3.636 & 3.636 \\ \hline Year 13 & 3.636 & 3.636 & 3.636 & 3.636 & 3.636 & 3.636 & 3.637 & 3.637 & 3.637 & 3.637 & 3.637 & 3.637 \\ \hline Year 14 & 3.637 & 3.637 & 3.637 & 3.637 & 3.637 & 3.637 & 3.636 & 3.636 & 3.636 & 3.636 & 3.636 & 3.636 \\ \hline Year 15 & 3.636 & 3.636 & 3.636 & 3.636 & 3.636 & 3.636 & 3.637 & 3.637 & 3.637 & 3.637 & 3.637 & 3.637 \\ \hline Year 16 & 3.637 & 3.637 & 3.637 & 3.637 & 3.637 & 3.637 & 3.636 & 3.636 & 3.636 & 3.636 & 3.636 & 3.636 \\ \hline Year 17 & 3.636 & 3.636 & 3.636 & 3.636 & 3.636 & 3.636 & 3.637 & 3.637 & 3.637 & 3.637 & 3.637 & 3.637 \\ \hline Year 18 & 3.637 & 3.637 & 3.637 & 3.637 & 3.637 & 3.637 & 3.636 & 3.636 & 3.636 & 3.636 & 3.636 & 3.636 \\ \hline Year 19 & 3.636 & 3.636 & 3.636 & 3.636 & 3.636 & 3.636 & 3.637 & 3.637 & 3.637 & 3.637 & 3.637 & 3.637 \\ \hline Year 20 & 3.637 & 3.637 & 3.637 & 3.637 & 3.637 & 3.637 & 3.636 & 3.636 & 3.636 & 3.636 & 3.636 & 3.636 \\ \hline Year 21 & 3.636 & 3.636 & 3.636 & 3.636 & 3.636 & 3.636 & 3.637 & 3.637 & 3.637 & 3.637 & 3.637 & 3.637 \\ \hline Year 22 & 3.637 & 3.637 & 3.637 & 3.637 & 3.637 & 3.637 & 3.636 & 3.636 & 3.636 & 3.636 & 3.636 & 3.636 \\ \hline Year 23 & 3.636 & 3.636 & 3.636 & 3.636 & 3.636 & 3.636 & 3.637 & 3.637 & 3.637 & 3.637 & 3.637 & 3.637 \\ \hline Year 24 & 3.637 & 3.637 & 3.637 & 3.637 & 3.637 & 3.637 & 3.636 & 3.636 & 3.636 & 3.636 & 3.636 & 3.636 \\ \hline Year 25 & 3.636 & 3.636 & 3.636 & 3.636 & 3.636 & 3.636 & 3.637 & 3.637 & 3.637 & 3.637 & 3.637 & 3.637 \\ \hline Year 26 & 3.637 & 3.637 & 3.637 & 3.637 & 3.637 & 3.637 & 3.636 & 3.636 & 3.636 & 3.636 & 3.636 & 3.636 \\ \hline Year 27 & 3.636 & 3.636 & 3.636 & 3.636 & 3.636 & 3.636 & 3.637 & 3.637 & 3.637 & 3.637 & 3.637 & 3.637 \\ \hline Year 28 & 1.97 & 2.273 & 2.576 & 2.879 & 3.182 & 3.485 & 3.636 & 3.636 & 3.636 & 3.636 & 3.636 & 3.636 \\ \hline Year 29 & & & & & & & 0.152 & 0.455 & 0.758 & 1.061 & 1.364 & 1.667 \\ \hline \end{tabular} TABLE 4 Nonresidential Real Property Mid-Month Convention Straight Line-31.5 Years (for assets placed in service before May 13, 1993) \begin{tabular}{|c|c|c|c|c|c|c|c|c|c|c|c|c|} \hline \multicolumn{13}{|c|}{ Month Property Placed in Service } \\ \hline & Month 1 & Month 2 & Month 3 & Month 4 & Month 5 & Month 6 & Month 7 & Month 8 & Month 9 & Month 10 & Month 11 & Month 12 \\ \hline Year 1 & 3.042% & 2.778% & 2.513% & 2.249% & 1.984% & 1.720% & 1.455% & 1.190% & 0.926% & 0.661% & 0.397% & 0.132% \\ \hline Year 2-7 & 3.175 & 3.175 & 3.175 & 3.175 & 3.175 & 3.175 & 3.175 & 3.175 & 3.175 & 3.175 & 3.175 & 3.175 \\ \hline Year 8 & 3.175 & 3.174 & 3.175 & 3.174 & 3.175 & 3.174 & 3.175 & 3.175 & 3.175 & 3.175 & 3.175 & 3.175 \\ \hline Year 9 & 3.174 & 3.175 & 3.174 & 3.175 & 3.174 & 3.175 & 3.174 & 3.175 & 3.174 & 3.175 & 3.174 & 3.175 \\ \hline Year 10 & 3.175 & 3.174 & 3.175 & 3.174 & 3.175 & 3.174 & 3.175 & 3.174 & 3.175 & 3.174 & 3.175 & 3.174 \\ \hline Year 11 & 3.174 & 3.175 & 3.174 & 3.175 & 3.174 & 3.175 & 3.174 & 3.175 & 3.174 & 3.175 & 3.174 & 3.175 \\ \hline Year 12 & 3.175 & 3.174 & 3.175 & 3.174 & 3.175 & 3.174 & 3.175 & 3.174 & 3.175 & 3.174 & 3.175 & 3.174 \\ \hline Year 13 & 3.174 & 3.175 & 3.174 & 3.175 & 3.174 & 3.175 & 3.174 & 3.175 & 3.174 & 3.175 & 3.174 & 3.175 \\ \hline Year 14 & 3.175 & 3.174 & 3.175 & 3.174 & 3.175 & 3.174 & 3.175 & 3.174 & 3.175 & 3.174 & 3.175 & 3.174 \\ \hline Year 15 & 3.174 & 3.175 & 3.174 & 3.175 & 3.174 & 3.175 & 3.174 & 3.175 & 3.174 & 3.175 & 3.174 & 3.175 \\ \hline Year 16 & 3.175 & 3.174 & 3.175 & 3.174 & 3.175 & 3.174 & 3.175 & 3.174 & 3.175 & 3.174 & 3.175 & 3.174 \\ \hline Year 17 & 3.174 & 3.175 & 3.174 & 3.175 & 3.174 & 3.175 & 3.174 & 3.175 & 3.174 & 3.175 & 3.174 & 3.175 \\ \hline Year 18 & 3.175 & 3.174 & 3.175 & 3.174 & 3.175 & 3.174 & 3.175 & 3.174 & 3.175 & 3.174 & 3.175 & 3.174 \\ \hline Year 19 & 3.174 & 3.175 & 3.174 & 3.175 & 3.174 & 3.175 & 3.174 & 3.175 & 3.174 & 3.175 & 3.174 & 3.175 \\ \hline Year 20 & 3.175 & 3.174 & 3.175 & 3.174 & 3.175 & 3.174 & 3.175 & 3.174 & 3.175 & 3.174 & 3.175 & 3.174 \\ \hline Year 21 & 3.174 & 3.175 & 3.174 & 3.175 & 3.174 & 3.175 & 3.174 & 3.175 & 3.174 & 3.175 & 3.174 & 3.175 \\ \hline Year 22 & 3.175 & 3.174 & 3.175 & 3.174 & 3.175 & 3.174 & 3.175 & 3.174 & 3.175 & 3.174 & 3.175 & 3.174 \\ \hline Year 23 & 3.174 & 3.175 & 3.174 & 3.175 & 3.174 & 3.175 & 3.174 & 3.115 & 3.174 & 3.175 & 3.174 & 3.175 \\ \hline Year 24 & 3.175 & 3.174 & 3.175 & 3.174 & 3.175 & 3.174 & 3.175 & 3.174 & 3.175 & 3.174 & 3.175 & 3.174 \\ \hline Year 25 & 3.174 & 3.175 & 3.174 & 3.175 & 3.174 & 3.175 & 3.174 & 3.175 & 3.174 & 3.175 & 3.174 & 3.175 \\ \hline Year 26 & 3.175 & 3.174 & 3.175 & 3.174 & 3.175 & 3.174 & 3.175 & 3.174 & 3.175 & 3.174 & 3.175 & 3.174 \\ \hline Year 27 & 3.174 & 3.175 & 3.174 & 3.175 & 3.174 & 3.175 & 3.174 & 3.175 & 3.174 & 3.175 & 3.174 & 3.175 \\ \hline Year 28 & 3.175 & 3.174 & 3.175 & 3.174 & 3.175 & 3.174 & 3.175 & 3.174 & 3.175 & 3.174 & 3.175 & 3.174 \\ \hline Year 29 & 3.174 & 3.175 & 3.174 & 3.175 & 3.174 & 3.175 & 3.174 & 3.175 & 3.174 & 3.175 & 3.174 & 3.175 \\ \hline Year 30 & 3.175 & 3.174 & 3.175 & 3.174 & 3.175 & 3.174 & 3.175 & 3.174 & 3.175 & 3.174 & 3.175 & 3.174 \\ \hline Year 31 & 3.174 & 3.175 & 3.174 & 3.175 & 3.174 & 3.175 & 3.174 & 3.175 & 3.174 & 3.175 & 3.174 & 3.175 \\ \hline Year 32 & 1.720 & 1.984 & 2.249 & 2.513 & 2.778 & 3.042 & 3.175 & 3.174 & 3.175 & 3.174 & 3.175 & 3.174 \\ \hline Year 33 & & & & & & & 0.132 & 0.397 & 0.661 & 0.926 & 1.190 & 1.455 \\ \hline \end{tabular} TABLE 5 Nonresidential Real Property Mid-Month Convention Straight Line-39 Years (for assets placed in service on or after May 13, 1993) \begin{tabular}{|c|c|c|c|c|c|c|c|c|c|c|c|c|} \hline \multicolumn{13}{|c|}{ Month Property Placed in Service } \\ \hline & Month 1 & Month 2 & Month 3 & Month 4 & Month 5 & Month 6 & Month 7 & Month 8 & Month 9 & Month 10 & Month 11 & Month 12 \\ \hline Year 1 & 2.461% & 2.247% & 2.033% & 1.819% & 1.605% & 1.391% & 1.177% & 0.963% & 0.749% & 0.535% & 0.321% & 0.107% \\ \hline Year 2-39 & 2.564 & 2.564 & 2.564 & 2.564 & 2.564 & 2.564 & 2.564 & 2.564 & 2.564 & 2.564 & 2.564 & 2.564 \\ \hline Year 40 & 0.107 & 0.321 & 0.535 & 0.749 & 0.963 & 1.177 & 1.391 & 1.605 & 1.819 & 2.033 & 2.247 & 2.461 \\ \hline \end{tabular}

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Accounting Systems

Authors: Ronald W. Hilton, David E. Platt

10th Edition

1308172486, 978-1308172484

More Books

Students also viewed these Accounting questions