Question

In: Accounting

Deborah purchases a new $32,000 car in 2016 to use exclusively in her business. If Deborah...

Deborah purchases a new $32,000 car in 2016 to use exclusively in her business. If Deborah does not elect to expense but does take bonus depreciation in 2016 and holds the car until it is fully depreciated, how many years will this take? Please show your calculation:

Solutions

Expert Solution

No. of years=10 years it will take to fully depreciate car.
Year Depreciation
1 $          11,160
2 $            5,100
3 $            3,050
4 $            1,875
5 $            1,875
6 $            1,875
7 $            1,875
8 $            1,875
9 $            1,875
10 $            1,440
Total $          32,000
For automobiles, depreciation for first year is 11,160, Second year is $5,100, Third year is $ 3,050 and $ 1,875 for each successive year till full depreciation is provided.

ekkarill92 answered 1 year ago
Next > < Previous

Related Solutions

Lina purchased a new car for use in her business during 2019. The auto was the...
Lina purchased a new car for use in her business during 2019. The auto was the only business asset she purchased during the year and her business was extremely profitable. Calculate her maximum depreciation deductions (including §179 expense unless stated otherwise) for the automobile in 2019 and 2020 (Lina doesn’t want to take bonus depreciation for 2019 or 2020) in the following alternative scenarios (assuming half-year convention for all): (Use MACRS Table 1, Table 2, and Exhibit 10-10.) 1.The vehicle...
Lina purchased a new car for use in her business during 2019. The auto was the...
Lina purchased a new car for use in her business during 2019. The auto was the only business asset she purchased during the year and her business was extremely profitable. Calculate her maximum depreciation deductions (including §179 expense unless stated otherwise) for the automobile in 2019 and 2020 (Lina doesn’t want to take bonus depreciation for 2019 or 2020) in the following alternative scenarios (assuming half-year convention for all): (Use MACRS Table 1, Table 2, and Exhibit 10-10.) b. The...
Lina purchased a new car for use in her business during 2019. The auto was the...
Lina purchased a new car for use in her business during 2019. The auto was the only business asset she purchased during the year and her business was extremely profitable. Calculate her maximum depreciation deductions (including §179 expense unless stated otherwise) for the automobile in 2019 and 2020 (Lina doesn’t want to take bonus depreciation for 2019 or 2020) in the following alternative scenarios (assuming half-year convention for all): (Use MACRS Table 1, Table 2, and Exhibit 10-10.) The vehicle...
Lina purchased a new car for use in her business during 2019. The auto was the...
Lina purchased a new car for use in her business during 2019. The auto was the only business asset she purchased during the year and her business was extremely profitable. Calculate her maximum depreciation deductions (including §179 expense unless stated otherwise) for the automobile in 2019 and 2020 (Lina doesn’t want to take bonus depreciation for 2019 or 2020) in the following alternative scenarios (assuming half-year convention for all a. The vehicle cost $32,800 and business use is 100 percent...
Ellen purchased a van for $28,000 to use exclusively in her delivery business. She sold it...
Ellen purchased a van for $28,000 to use exclusively in her delivery business. She sold it four months later in the same year for $22,500. What is the amount of gain or loss, and where does Ellen report the sale? A. $5,500 gain, Form 4797, Part I. B. $5,500 loss, Form 4797, Part I. C. $5,500 loss, Form 4797, Part II. D. $5,500 loss, Schedule D.
In a recent advertisement a new car has a sale price of $32,000. The car company...
In a recent advertisement a new car has a sale price of $32,000. The car company is giving you the option of receiving a $3500 cash rebate or a special interest rate (for those who qualify) at 0.9% for 5 years. If the local bank will lend you the money at 4.5% for 5 years should you take the discount and borrow from the bank or select the low interest rate from the company? What option would you select and...
The price of a new car is $32,000. Assume that an individual makes a down payment...
The price of a new car is $32,000. Assume that an individual makes a down payment of 25% toward the purchase of the car and secures financing for the balance at the rate of 7%/year compounded monthly. (Round your answers to the nearest cent.) (a) What monthly payment will she be required to make if the car is financed over a period of 48 months? Over a period of 72 months? 48 months $ 72 months $ (b) What will...
On June 15, 2018, Chang purchases $2,537,000 of equipment (7-year property) for use in her business....
On June 15, 2018, Chang purchases $2,537,000 of equipment (7-year property) for use in her business. It is her only purchase of business property in 2018. Chang has taxable income from her business of $2,500,000 before any cost recovery. Click here to access depreciation Table 8-2. a.  Assuming Chang does not elect Section 179 and elects out of bonus depreciation, what is her total 2018 cost recovery? $ b.  Assuming Chang elects the maximum Section 179 deduction allowable and elects out of...
Bob's Cars purchased a new car for use in its business on January 1, 2017. It...
Bob's Cars purchased a new car for use in its business on January 1, 2017. It paid $30,000 for the car. Charm expects the car to have a useful life of four years with an estimated residual value of zero. Charm expects to drive the car as follows Year 2017: 20,000 miles driven Year 2018: 45,000 miles driven Year 2019: 40,000 miles driven Year 2020: 15,000 miles driven Total Miles Driven: 120,000 miles 1. Using the straight-line method of depreciation,...
During 2019, William purchases the following capital assets for use in his catering business: New passenger...
During 2019, William purchases the following capital assets for use in his catering business: New passenger automobile (September 30) $58,200 Baking equipment (June 30) 17,460 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. Assume he has adequate...
ADVERTISEMENT
Subjects
ADVERTISEMENT
Latest Questions
ADVERTISEMENT