Question

In October 2019, Frank purchased a $30,000 non-luxury vehicle to use in his business. During all of 2019, Frank purchased $60,000 of new equipment for his business (including the vehicle). How much depreciation is Frank allowed for 2019? Ignore IRC 179 and bonus depreciation.

Group of answer choices

$12,000

$6,000

$1,500

$2,500

Answer 1

$12000 depreciation is Frank allowed for 2019 assuming life of 5 years and no salvage, according to straight line method
Total value of purchased equipments in 2019 is $60000

$60000X 20% = $12000 for each year for 5 years

Straight Line Depreciation. The method described above is called straight-line depreciation, in which the amount of the deduction for depreciation is the same for each year of the life of the asset.

(If you are still bot satisfied with the answer you can write comment in the comment box )

Thanks