The basis of the machine after three years. (40,000-16,000-12,800-7680) = 3,520 fromprobutterfly

The basis of cost recovery property is reduced by the cost recovery allowed, and by not less than the allowable amount. ((40,000-16,000-12,800-7680)-15,000)) = 11,480

i want to make sure this is correct how had

1.Tara purchased a machine for $40,000 to be used in her business. The cost recovery allowed and allowable for the three years the machine was used are as follows:

cost recovery allowed Cost recovery allowed

YEar 1 16,000 8000

Year 2 . 9600 12,800

Year 3 . 5760 7680

a)What is the basis of the machine after three years?

b)If Tara sells the machine at the end of three years for $15,000, how much gain should she recognize?

This from my individual income tax class