Question

Convers Corporation (calendar-year-end) acquired the following assets during the current tax year: (ignore §179 expense and bonus depreciation for this problem): (Use MACRS Table 1, Table2,and Table 5.)

Asset	Date Placed in Service	Original Basis
Machinery	October 25	$110,000
Computer Equipment	February 3	$50,000
Used delivery Truck*	March 17	$63,000
Furniture	April 22	$190,000
Total		$413,000

*the delivery truck is not a luxury automobile

In addition to these assets, Convers installed new flooring (qualified improvement property) to its office building on May 12 at a cost of $700,000

a. What is the allowable MACRS depreciation on Convers’s property in the current year assuming Convers does not elect §179 expense and elects out of bonus depreciation? (Round you intermediate calculations to the nearest whole dollar amount)

Answer 1

a.)	Half year convention
	Asset	Date Placed in Service	Quarter	Original Basis $ -A	Rate -B	Depreciation $ (A X B )
	Machinery	Oct-25	4th	110,000	14.29%	15,719
	Computer Equipment	Feb-03	1st	50,000	20.00%	10,000
	Used delivery Truck	Mar-17	1st	63,000	20.00%	12,600
	Furniture	Apr-22	2nd	190,000	14.29%	27,151
	Qualified Improvement	May-12	2nd	700,000	1.065%	7,455
	Total			1,113,000		72,925
	MACRS depreciation $72,925