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McCanless Co. recently purchased an asset for $2,550,000 that will be used in a 3-year project....

McCanless Co. recently purchased an asset for $2,550,000 that will be used in a 3-year project. The asset is in the 4-year MACRS class. The depreciation percentage each year is 33.33 percent, 44.45 percent, 14.81 percent, and 7.41 percent, respectively. What is the amount of depreciation in Year 2? A) $849,915 B) $850,000 C) $1,133,475 D) $188,955 E) $377,655

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Answer #1

Ans C) $1,133,475

depreciation in Year 2 = Asset amount * Depreciation percentage in year 2

                                    = 2550000 * 44.45%

                                    = $1,133,475

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