Compute the bonus depreciation

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Question: On August 1, 2016, David purchased manufacturing equipment for use in his business. The equipment cost $14,000 and has an estimated useful life and MACRS class life of 7 years. No election to expense or use bonus depreciation is made.

a. Calculate the amount of depreciation on the manufacturing equipment for 2016 using the accelerated MACRS method and no election to expense or use bonus depreciation is made.

b. Calculate the amount of depreciation on the manufacturing equipment for 2016 using the accelerated MACRS method and bonus depreciation used but no election to expense.

c. Calculate the amount of depreciation on the manufacturing equipment for 2016 using the straight-line MACRS optional method and no election to expense or use bonus depreciation is made.

d. Calculate the amount of depreciation on the manufacturing equipment for 2016 for financial accounting purposes using the straight-line method of depreciation.

Reference no: EM131746837

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