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[The following information applies to the questions displayed below.] While completing undergraduate school work in information systems, Dallin Bourne and Michael Banks decided to start
[The following information applies to the questions displayed below.] While completing undergraduate school work in information systems, Dallin Bourne and Michael Banks decided to start a technology support company called eSys Answers. During year 1, they bought the following assets and incurred the following start-up fees: In April of year 2, they decided to purchase a customer list from a company providing virtually the same services, started by fellow information systems students preparing to graduate. The customer list cost $13,060, and the sale was completed on April 30. During their summer break, Dallin and Michael passed on internship opportunities in an attempt to really grow their business into something they could do full time after graduation. In the summer, they purchased a small van (for transportation, not considered a luxury auto) and a pinball machine (to help attract new employees). They bought the van on June 15 , Year 2 , for $32,000 and spent $4,700 getting it ready to put into service. The pinball machine cost $5,700 and was placed in service on July 1 , Year 2. Assume that eSys Answers does not claim any 179 expense or bonus depreciation. (Use MACRS Table 1, Table 2, Table 3 , Table 4 and ) (Round your intermediate calculations and final answers to the nearest whole dollar amount.) Required: a. What are the maximum cost recovery deductions for eSys Answers for Year 1 and Year 2? c. What is eSys Answers' basis in each of its assets at the end of Year 2? Complete this question by entering your answers in the tabs below. What are the maximum cost recovery deductions for eSys Answers for Year 1 and Year 2? Complete this question by entering your answers in the tabs below. What is eSys Answers' basis in each of its assets at the end of Year 2
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