[The following information applies to the questions displayed below.] Back in Boston, Steve has been busy creating and managing his new company, Teton Mountaineering (TM), which is based out of a small town in Wyoming. In the process of doing so, TM has acquired various types of assets. Below is a list of assets acquired during 2013:

Asset Cost Date Placed in Service

Office furniture $ 10,000 02/03/2013

Machinery 560,000 07/22/2013

Used delivery truck* 15,000 08/17/2013

* Not considered a luxury automobile, thus not subject to the luxury automobile limitations.

During 2013, TM had huge success (and had no 179 limitations) and Steve acquired more assets the next year to increase its production capacity. These are the assets acquired during 2014:

Asset Cost Date Placed in Service

Computers & info. system $ 40,000 03/31/2014

Luxury auto 80,000 05/26/2014

Assembly equipment 475,000 08/15/2014

Storage building 400,000 11/13/2014

Used 100% for business purposes.

Use 2013 limitations for 2014. TM generated a taxable income in 2014 before any 179 expense of $732,500.

a. Compute maximum 2013 depreciation deductions including 179 expense (ignoring bonus depreciation).

b. Compute maximum 2014 depreciation deductions including 179 expense (ignoring bonus depreciation).

c. Compute maximum 2014 depreciation deductions including 179 expense, but now assume that Steve would like to take bonus depreciation on the 2014 assets.

d. Ignoring part (c), now assume that during 2014, Steve decides to buy a competitors assets for a purchase price of $350,000. Compute maximum 2014 cost recovery including 179 expense (ignoring bonus depreciation). Steve purchased the following assets for the lump-sum purchase price.

Asset Cost Date Placed in Service Inventory $20,000 09/15/2014 Office furniture $30,000 09/15/2014 Machinery 50,000 09/15/2014 Patent 98,000 09/15/2014 Goodwill 2,000 09/15/2014 Building 130,000 09/15/2014 Land 20,000 09/15/2014