Suber, Incorporated, a calendar year taxpayer, purchased equipment for $780,000 and placed it in service on March 1. Subers chief engineer determined that the equipment had an estimated useful life of 120 months and a $48,000 residual value. For financial statement purposes, Suber uses the straight-line method to compute depreciation. Use Table 7-2.

Required:

a. Compute book depreciation for the year.

Book depreciation: ?

b. Assuming that the equipment has a seven-year recovery period and is subject to the half-year convention, compute MACRS depreciation for the year.

MACRS depreciation: $

c. Compute Subers book basis and tax basis in the equipment at the beginning of next year.

	Amount
Book basis
Tax Basis