See attachments and tables below:
Convers Corporation (calendar-year-end) acquired the following assets during the current tax year: (ignore 179 expense and bonus depreciation for this problem)
Asset Date Placed in Service Original Basis
Machinery October 25 $70,000
Computer equipment February 3 $10,000
Used delivery truck* March 17 $23,000
Furniture April 22 $150,000
Total $253,000
*The delivery truck is not a luxury automobile.
In addition to these assets, Convers installed new flooring (qualified improvement property) to its office building on May 12 at a cost of $300,000.
What is the allowable MACRS depreciation on Convers's property in the current year assuming Convers does not elect out of bonus depreciation (but does not take 179 expense)?
?
Table l NIACRS HalfYear Convention Depreciation Rate for Recovery Period W... W Year 1 33 33% 20.00% 14.29% 10.00% Year 2 44.45 32.00 24.49 18.00 Year 3 19.20 12.49 14.40 Year 4 2.41 1 1.52 12.49 11.52 Year 5 1 1.52 8.93 9.22 Year 6 5 . 26 8.92 3'3 2 Year 2 8.93 6.55 Year 8 4 46 6.55 Year 9 6.56 Year 10 6.55 Year 11 3 .23 Year 12 Year 13 Year 14 Year 15 Year 16 Year 17 Year 18 Year 19 Year 20 Year 2 1 15Year 5.00% 9.50 8.55 7.20 6.93 6 23 20Year 3 .25 0% 2.219 6.67? 5. 177 5.? 13 5.285 4.888 4.522 4.462 4.461 4.462 4.461 5 .91 4.462 5 4.461 5 .91 4.462 2 .95 4.461 4.462 4.461 4.462 4.461 2.23 1 E 90 5.91 5.90 5.91 L)! TABLE 5 Nonresidential Real Property Mid-Month Convention Straight Line-39 Years (for assets placed in service on or after May 13, 1993) Month Property Placed in Service Month 1 Month 2 Month 3 Month 4 Month 5 Month 6 Month 7 Month S Month 9 Month 10 Month 11 Month 12 Year 1 2.461% 2.247% 2.033% 1.819% 1.605% 1.391% 1.177% 0.963% ).749% 0.535% 0.321% 0.107% 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 Year 40 0.107 0.321 0.535 0.749 0.963 1.177 1.391 1.605 1.819 2.033 2.247 2.461TABLE 2a MACRS Mid-Quarter Convention: For property placed in service during the first quarter Depreciation Rate for Recovery Period 5-Year 7-Year Year 1 35.00% 25.00% Year 26.00 21.43 Year 3 15.60 15.31 Year 4 11.01 10.93 Year 5 11.01 8.75 Year 6 1.38 3.74 Year 7 8.75 Year S 1.09 TABLE 2b MACRS Mid-Quarter Convention: For property placed in service during the second quarter Depreciation Rate for Recovery Period 5-Year 7-Year Year I 25.00% 17.85% Year 30.00 23.47 Year 18.00 16.76 Year 11.37 11.97 Year 5 11.37 3.87 Year 6 4.26 3.87 Year 3.87 Year S 3.34 J.JT TABLE 2c MACRS Mid-Quarter Convention: For property 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 25.5 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 3.86 Year S 5.53 TABLE 2d MACRS-Mid Quarter Convention: For property placed in service during the fourth quarter Depreciation Rate for Recovery Period 5-Year 7-Year Year 5.00% 3.57% Year 2 38.00 27.5 Year 3 22.80 19.68 Year 4 13.68 4.06 Year 5 10.94 10.04 Year 6 9.58 8.73 Year 7 8.73 Year S 7.64