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During 2019, William purchases the following capital assets for use in his catering business:
New passenger automobile (September 30) $54,000
Baking equipment (June 30) 7,000
Assume that William decides to use the election to expense on the baking equipment (and has adequate taxable income to cover the deduction) but not on the automobile (which has a 5-year recovery period), and he also uses the MACRS accelerated method to calculate depreciation but elects out of bonus depreciation.
Problem 1: Calculate William's maximum depreciation deduction for 2019, assuming he uses the automobile 100 percent in his business.
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