Calculate the cost recovery deduction

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On June 1, 2009, Sam purchased new farm machinery for $50,000. Sam used the machinery in connection with his farming business. Sam does not elect to expense assets under § 179. Sam has, however, made an election to not have the uniform capitalization rules apply to the farming business. Sam does elect not to take additional first-year depreciation. Determine the cost recovery deduction for 2009.

A) $5,000.

B) $7,500.

C) $10,000.

D) $12,500.

E) None of the above.

Reference no: EM13142472

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