Accounting Question

Accounting Question


Don't use plagiarized sources. Get Your Custom Essay on
Accounting Question
Just from $15/Page
Order Essay

Vanessa owns a consulting business that has always been reported as a sole proprietorship on her tax return. Assume that on February 19, 2016 Vanessa purchases a new computer for $5,000 that will be used solely for her business. Using the depreciation table below compute her depreciation expense for 2016. Assume no bonus depreciation and no Section 179 depreciation.

Cost of asset
Depreciation % from Table
Months deemed owned in 2016
Regular MACRS Depreciation for 2016

Assume that Vanessa sells this computer on August 3, 2018. What would MACRS depreciation be for the computer for 2018?

MACRS Depreciation

MACRS Accelerated Depreciation Table

Recovery Year Property Class
  3-year 5-year 7-year
1 33.33% 20.00% 14.29%
2 44.45 32.00 24.49
3 14.81 19.20 17.49
4 7.41 11.52 12.49
5   11.52 8.93
6   5.76 8.92
7     8.93
8     4.46



Cola, Inc. purchased all of its personalty (equipment) in the fourth quarter of its tax year. Provide the IRC Section and subsection that indicates the convention that applies when computing MACRS depreciation in this situation.

Enter your response in the answer fields below. Guidance on correctly structuring your response appears above and below the answer fields.

Choose a title from the list.

 §   ·  

Examples of correctly formatted IRC responses are IRC§1(a),IRC§12(a),IRC§12A(a),IRC§12AA(a),IRC§123(a),
IRC§123A(a),IRC§1234(a),IRC§1234A(a), and IRC§1234A-5(a)