What is the depreciation deduction in year three

Reference no: EM13692415

During its current tax year (year one), a pharmaceutical company purchased a mixing tank that had a fair market price of $120,000. it replaced an older, smaller mixing tank that had a BV of $15,000. Because a special promotion was underway, the old tank was used as a trade-in for the new one, and the cash price (including delivery and installation) was set at $99,500. The MACRS class life for the new mixing tank is 9.5 years. (7.4,7.3)

a) Under the GDS, what is the depreciation deduction in year three?

b) Under the GDS, what is the BV at the end of year four?

c) If 200% DB depreciation had been applied to this problem, what would be the cumulative depreciation through the end of year four?

Reference no: EM13692415

Questions Cloud

What proportional tax rate would yield the same tax revenue : A sales person has the following utility function: u(w, ?) = sqrt(w, ?), w is the hourly wage and ? is the number of hours worked in a typical day. This person is choosing between 2 jobs. The first job promises a constant work day of 8 hours and an h..

What is the short-run effect of a fiscal contraction : Explain what is the short-run effect of a fiscal contraction (lower government spending for example)? What happens to the nominal wage rate during the process of moving from short-run equilibrium to long run equilibrium?

Great depression were dominated by : The first two years of the Great Depression were dominated by

Special-purpose machine is to depreciated as linear function : A special-purpose machine is to be depreciated as a linear function of uses (units-of-production method). It costs $35,000 and is expected to produce 150,000 units and then be sold for $5,000. Up to the end of the third year, it had produced 60,000 u..

What is the depreciation deduction in year three : During its current tax year (year one), a pharmaceutical company purchased a mixing tank that had a fair market price of $120,000. it replaced an older, smaller mixing tank that had a BV of $15,000.

Determine the gds and ads depreciation deductions : A piece of construction equipment (asset class 15.0) was purchased by the Jones construcion company. The cost basis was $300,000. Determine the GDS and ADS depreciation deductions for this property.

An asset for drilling was purchased and placed in service : An asset for drilling was purchased and placed in service by a petrolium production company. it cost basis is $60,000 and it has an estimated MV of $12,000 at the end of an estimated useful life of 14 years.

Contractionary-the natural employment deficit falls : Suppose we have an economy in which G = 100, t = 0.26, Y = 3800, and YN = 4000. Then t rises to 0.28 as the same time as G rises to 150. The overall impact of this resettling of the fiscal variables is ________ because ________.

A vacation home in malibu is : A vacation home in Malibu is

User Account

All Pages