Assume that ACW Corporation has 2023 taxable income of $1,900,000 for purposes of computing the §179 expense. The company acquired the following assets during 2023 (assume no bonus depreciation): (Use MACRS Table 1, Table 2, and Table 5.) Asset Machinery Computer equipment Delivery truck Qualified real property (MACRS, 15 year, 150% DB) Total Placed in Service 12-September 10-February 21-August 02-April Basis $ 510,000 110,000 133,000 1,420,000 $ 2,173,000 a. What is the maximum amount of §179 expense ACW may deduct for 2023? b. What is the maximum total depreciation that ACW may deduct in 2023 on the assets it placed in service in 2023? Note: Round your intermediate calculations and final answer to the nearest whole dollar amount. > Answer is complete but not entirely correct. $ 1,900,000 X 170,956 x $ a. Maximum §179 expense for 2023 b. Maximum total deductible depreciation for 2023
Assume that ACW Corporation has 2023 taxable income of $1,900,000 for purposes of computing the §179 expense. The company acquired the following assets during 2023 (assume no bonus depreciation): (Use MACRS Table 1, Table 2, and Table 5.) Asset Machinery Computer equipment Delivery truck Qualified real property (MACRS, 15 year, 150% DB) Total Placed in Service 12-September 10-February 21-August 02-April Basis $ 510,000 110,000 133,000 1,420,000 $ 2,173,000 a. What is the maximum amount of §179 expense ACW may deduct for 2023? b. What is the maximum total depreciation that ACW may deduct in 2023 on the assets it placed in service in 2023? Note: Round your intermediate calculations and final answer to the nearest whole dollar amount. > Answer is complete but not entirely correct. $ 1,900,000 X 170,956 x $ a. Maximum §179 expense for 2023 b. Maximum total deductible depreciation for 2023
SWFT Essntl Tax Individ/Bus Entities 2020
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Author:Nellen
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Chapter5: Business Deductions
Section: Chapter Questions
Problem 4BCRQ
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Depreciation Methods
The word "depreciation" is defined as an accounting method wherein the cost of tangible assets is spread over its useful life and it usually denotes how much of the assets value has been used up. The depreciation is usually considered as an operating expense. The main reason behind depreciation includes wear and tear of the assets, obsolescence etc.
Depreciation Accounting
In terms of accounting, with the passage of time the value of a fixed asset (like machinery, plants, furniture etc.) goes down over a specific period of time is known as depreciation. Now, the question comes in your mind, why the value of the fixed asset reduces over time.
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Transcribed Image Text:Assume that ACW Corporation has 2023 taxable income of $1,900,000 for purposes of computing the §179 expense. The company
acquired the following assets during 2023 (assume no bonus depreciation): (Use MACRS Table 1, Table 2, and Table 5.)
Asset
Machinery
Computer equipment
Delivery truck
Qualified real property (MACRS, 15
year, 150% DB)
Total
Placed in Service
12-September
10-February
21-August
02-April
Basis
$ 510,000
110,000
133,000
1,420,000
$ 2,173,000
a. What is the maximum amount of §179 expense ACW may deduct for 2023?
b. What is the maximum total depreciation that ACW may deduct in 2023 on the assets it placed in service in 2023?
Note: Round your intermediate calculations and final answer to the nearest whole dollar amount.
> Answer is complete but not entirely correct.
$
1,900,000 X
170,956 x
$
a. Maximum §179 expense for 2023
b. Maximum total deductible depreciation for 2023
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