Question

XYZ Inc. uses a June 30 fiscal year-end. In fiscal year 2019 (year ending June 30,...

XYZ Inc. uses a June 30 fiscal year-end. In fiscal year 2019 (year ending June 30, 2019), the company acquired two 3-year class assets shown below. What cost recovery deduction can XYZ Inc. take in fiscal year 2019? Assume XYZ does not elect to take Sec. 179 expense or bonus depreciation.

                                       Acquisition Date           Cost

            Asset 1             January 2019                $4,000

            Asset 2             May 2019                     $10,000

Business   Accounting   
0 0
Add a commentTranscribed image text
Next >

Homework Answers

Answer #1

Solution:

Date Placed in Service Convention Type Asset Class Cost Rate Cost recovery
Jan-19 Mid Quarter [ Third Quarter] 3 Years $         4,000.00 25.00% $              1,000.00
May-19 Mid Quarter [ Fourth Quarter] 3 Years $      10,000.00 8.33% $                  833.00
Total $              1,833.00

Notes:

1) Mid Quarter Convention has been used because more than 40% of assets are acquired in Fourth quarter of fiscal year ended June 30.

0 0
Know the answer?
Your Answer:

Post as a guest

Your Name:

What's your source?

Earn Coins

Coins can be redeemed for fabulous gifts.

Log In

Sign Up

Not the answer you're looking for?
Ask your own homework help question
Similar Questions
Sam’s Bakery acquired and placed in service a new oven (7-year class asset) with a cost...
Sam’s Bakery acquired and placed in service a new oven (7-year class asset) with a cost of $18,000 in November 2020. The company is a calendar year taxpayer, and this was the only asset acquired in 2020. Sam’s Bakery disposes of the oven in July 2021. What cost recovery deduction can the company take in 2021? Assume Sam’s did not elect Sec. 179 expense or bonus depreciation.
1. Poplock Corporation acquired and placed in service the following assets during the year, 2019: Asset...
1. Poplock Corporation acquired and placed in service the following assets during the year, 2019: Asset Date Acquired Cost Basis Computer equipment 3/23 $7,000 Dog grooming furniture 5/12 $7,000 Pickup truck 9/17 $10,000 Commercial building 10/11 $270,000 Land (one acre) 10/11 $80,000 Assuming DLW does not elect §179 expensing or bonus depreciation. What is Poplock's year 2 total cost recovery for these assets? 2. DLW Corporation acquired and placed in service the following assets during the year, 2019: Asset Date...
5) On 30 June 2019, ABC LLC placed into service a building used as a retail...
5) On 30 June 2019, ABC LLC placed into service a building used as a retail location with an initial basis of $275,000. Further, ABC did not elect 179 expensing and elected out of bonus depreciation (no 179 or bonus). Determine the depreciation deduction for the building for 2019. FOR TAX YEAR 20109 ENTER ANSWER:
On 30 June 2019, ABC LLC placed into service a building used as a retail location...
On 30 June 2019, ABC LLC placed into service a building used as a retail location with an initial basis of $275,000. Further, ABC did not elect 179 expensing and elected out of bonus depreciation (no 179 or bonus). Determine the depreciation deduction for the building for 2019.
On June 5, 2019, Javier Sanchez purchased and placed in service a new 7-year class asset...
On June 5, 2019, Javier Sanchez purchased and placed in service a new 7-year class asset costing $560,000 for use in his landscaping business, which he operates as a single member LLC (Sanchez Landscaping LLC). During 2019, his business generated a net income of $945,780 before any $179 immediate expense election. Rather than using bonus depreciation, Javier would like to use $179 to expense $200,000 of this asset and then use regular MACRS to cost recover the remaining cost. If...
On April 15, 2017, Andy purchased some furniture and fixtures (7-year property) for $11,000 to be...
On April 15, 2017, Andy purchased some furniture and fixtures (7-year property) for $11,000 to be used in his business. He did not elect to expense the equipment under §179 or bonus depreciation. On June 30, 2019, he sells the equipment. What is the cost recovery deduction for 2019?
Juan, a sole proprietor, acquires a new 5-year class asset on March 14, 2017, for $200,000....
Juan, a sole proprietor, acquires a new 5-year class asset on March 14, 2017, for $200,000. This is the only asset Juan acquired during the year. He does not elect immediate expensing under § 179. Juan does not claim any available additional first-year depreciation. A. Determine Juan's cost recovery for 2017 $ B. On January 15, 2019, Juan sells the asset. Determine Juan's cost recovery for 2019 $ C. Suppose Juan sold the asset on December 15, 2019. His cost...
On June 5, 2019, Javier Sanchez purchased and placed in service a new 7-year class asset...
On June 5, 2019, Javier Sanchez purchased and placed in service a new 7-year class asset costing $560,000 for use in his landscaping business, which he operates as a single-member LLC (Sanchez Landscaping LLC). During 2019, his business generated a net income of $945,780 before any § 179 immediate expense election. Rather than using bonus depreciation, Javier would like to use § 179 to expense $200,000 of this asset and then use regular MACRS to cost recover the remaining cost....
Calculate the maximum tax year 2019 depreciation deduction allowable for property that is properly classified as...
Calculate the maximum tax year 2019 depreciation deduction allowable for property that is properly classified as new five year property and is not an automobile. The taxpayer is a calendar year taxpayer and placed the property into service on June 1, 2019. The property was acquired for $97,000 and the taxpayer did not elect bonus depreciation or section 179 expensing. The taxpayer placed no other depreciable property into service in 2019
Nick’s Lawn Service acquires and places in service a new lawnmower, a 7-year class asset, in...
Nick’s Lawn Service acquires and places in service a new lawnmower, a 7-year class asset, in September 2020 for $2,500. Nick disposes of the lawnmower in February 2022. What cost recovery deduction can Nick’s company take in 2022? Assume the company is a calendar year taxpayer and does not take Sec. 179 expense or bonus first-year depreciation.
ADVERTISEMENT
Need Online Homework Help?

Get Answers For Free
Most questions answered within 1 hours.

Ask a Question
ADVERTISEMENT