Don will hire four new associates one on july 1 of each

Assignment Help Accounting Basics

Reference no: EM13608042

Can someone help me with a depreciation schedule showing MACRS depreciation? This is the problem: Don has heard that using MACRS for tax purposes will save him taxes. He wants you to develop a schedule showing MACRS depreciation for his tax return over the next eight years under the following assumptions:

1. Don will start his business on July 1, 20-1, and will purchase a new computer on that date.

2. Don will hire four new associates, one on July 1 of each year for the next four years, 20-2 through 20-5. He will also buy each associate a computer.

3. The computers cost $4,000, have useful lives of five years, and have no salvage value. Don will take a hal-year's depreciation in the first and last year of each computer's life.

4. As each computer complete its five-year life, Don will buy a new one to replac it.

5. Don's tax rate is 30%. Prepare a depreciation schedule showing the MACRS depreciation for years 20-1 through 20-8. I've made a schedule of my own but don't think it's right. Any help I can get will be much appreciated!

Reference no: EM13608042

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