Question

4. At the beginning of the year, Poplock began a calendar-year dog boarding business called Griff’s Palace. Poplock bought and placed in service the following assets during the year:

Asset                                 Date Acquired   Cost Basis

Computer equipment      3/23                          $5,000

Dog grooming furniture  5/12                       $7,000

Pickup truck                      9/17                      $10,000

Commercial building       10/11                    $280,000

Land (one acre)                10/11                    $80,000

Assuming Poplock does not elect §179 expensing or bonus depreciation, what is Poplock’s year 2 depreciation expense for each asset?

Answer 1

Poplock's year 2 depreciation deduction for each asset is as follows:-

Assets	Purchase date	Quarter	Recovery period(A)	Cost($)(B)	Depreciation(2nd year)	Rate of depreciation
Computer Equipment	3/23	Ist	5yrs	5000	1600	32%
Dog grooming furniture	5/12	2nd	7yrs	7000	1714	24.49%
Pickup truck	9/17	3rd	5yrs	10000	3200	32%
Commercial Building	10/11	4th	39yrs	280000	7179	2.564%

No depreciation is charged on land.