eBookExercise 8-21 (LO. 2)Lopez acquired a building on June 1, 2015, for $1,000,000. Compute the depreciation deduction assuming the building is classified as (a)residential and (b) non residential.Click here to access the depreciation table to use for this problem.If required, round your answers to the nearest dollar.a. Calculate Lopez's cost recovery deduction for 2020 if the building is classified as residential rental real estate.b. Calculate Lopez's cost recovery deduction for 2020 if the building is classified as nonresidential real estate.etsal.aCheck My Work216 PM59 F Partly suneyCA4 de mibit 8.8 MACRS Straight-Line Depreciation for Real Property AssumingMid-Month Convention* (Percentage Rates)For Property Placed in Service after December 31, 1986: 27.5-Year Residential Real PropertyRecovery The Applicable Percentage Is (Use the Column for the Month in the First Year the Property Is Placed in Service):Year(s)1456891011123.4853.1822.8792.5762.2731.9701.6671.3641.0610.7580.4550.1522-183.6363.6363.6363.6363.6363.6363.6363.6363.6363.6363.6363.63619-273.6373.6373.6373.6373.6373.6373.6373.6373.6373.6373.6373.637281.9702.2732.5762.8793.1823.4853.6363.6363.6363.6363.6363.636290.0000.0000.0000.0000.0000.0000.1520.4550.7581.0611.3641.667For Property Placed in Service after December 31, 1986, and before May 13, 1993:31.5-Year Nonresidential Real PropertyThe Applicable Percentage Is (Use the Column for the Month in the First Year the Property Is Placed in Service):RecoveryYear(s)345671011123.0422.7782.5132.2491.9841.7201.4551.1900.9260.6610.3970.1322-193.1753.1753.1753.1753.1753.1753.1753,1753.1753.1753.1753.17520-313.1743.1743.1743.1743.1743.1743.1743.1743.1743.1743.1743.174321.7201.9842.2492.5132.7783.0423.1753.1753.1753.1753.1753.175330.0000.0000.0000.0000.0000.0000.1320.3970.6610.9261.1901,455For Property Placed in Service after May 12, 1993: 39-Year Nonresidential Real PropertyThe Applicable Percentage Is (Use the Column for the Month in the First Year the Property Is Placed in Service):RecoveryYear(s)12.46.81011121.2.4612.2472.0331.8191.6051.3911.1770.9630.7490.5350.3210.1072-392.5642.5642.5642.5642.5642.5642.5642.5642.5642.5642.5642.564400.1070.3210.5350.7490.9631.1771.3911.6051.8192.0332.2472.461*The official tables contain a separate row for each year. For ease of presentation, certain years are3:19 PM59°F Partly sunny2/20/2022bp

The rate of depreciation will be 3.636% on the total value of the asset on the straight-line method…

Exercise 8-21 (LO. 2) Lopez acquired a building on June 1, 2015, for $1,000,000. Compute the depreciation deduction assuming the building is classified as (a) residential and (b) non residential. Click here to access the depreciation table to use for this problem. If required, round your answers to the nearest dollar. a. Calculate Lopez's cost recovery deduction for 2020 if the building is classified as residential rental real estate. b. Calculate Lopez's cost recovery deduction for 2020 if the building is classified as nonresidential real estate.

Exercise 8-21 (LO. 2) Lopez acquired a building on June 1, 2015, for $1,000,000. Compute the depreciation deduction assuming the building is classified as (a) residential and (b) non residential. Click here to access the depreciation table to use for this problem. If required, round your answers to the nearest dollar. a. Calculate Lopez's cost recovery deduction for 2020 if the building is classified as residential rental real estate. b. Calculate Lopez's cost recovery deduction for 2020 if the building is classified as nonresidential real estate.

SWFT Comprehensive Vol 2020

43rd Edition

ISBN:9780357391723

Author:Maloney

Publisher:Maloney

Chapter8: Depreciation, Cost Recovery, Amortization, And Depletion

Section: Chapter Questions

Problem 23CE

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Similar questions

Chapman Inc. purchased a piece of equipment in 2018. Chapman depreciated the equipment on a straight-line basis over a useful life of 10 years and used a residual value of $12,000. Chapmans depreciation expense for 2019 was $11,000. What was the original cost of the building? a. $98,000 b. $110,000 c. $122,000 d. $134,000
LO.2, 3, 9 On June 5, 2018, 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 2018, his business generated a net income of 945,780 before any 179 immediate expense election. a. 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. Given this information, determine the cost recovery deductions that Javier can claim with respect to this asset in 2018 and 2019. b. Complete Javiers Form 4562 (page 1) for 2018. His Social Security number is 123-45-6789.
LO.3 Renata Corporation purchased equipment in 2017 for 180,000 and has taken 83,000 of regular MACRS depreciation. Renata Corporation sells the equipment in 2019 for 110,000. What is the amount and character of Renatas gain or loss?
On January 1, 2014, Klinefelter Company purchased a building for 520,000. The building had an estimated life of 20 years and an estimated residual value of 20,000. The company has been depreciating the building using straight-line depreciation. At the beginning of 2020, the following independent situations occur: a. The company estimates that the building has a remaining life of 10 years (for a total of 16 years). b. The company changes to the sum-of-the-years-digits method. c. The company discovers that it had ignored the estimated residual value in the computation of the annual depreciation each year. Required: For each of the independent situations, prepare all journal entries related to the building for 2020. Ignore income taxes.