In 2020, LRRR Corp., a calendar year corporation, acquired and placed in service the assets listed below. Asset Placed in Service Cost Recovery Period Computer 8/21/2020 1,050,000 5 years Machine 10/12/2020 1,000,000 7 years Warehouse 12/2/2020 2,000,000 39 years Assume (1) no bonus depreciation, (2) no Section 179 expense for question. 1. What convention is used to depreciate each asset and why? 2. What is the total depreciation expense LRRR Corp. may deduct in 2020? 3. What is LRRR Corps's deprecation expense in 2021? 4. Assume LRRR Corp sold all assets on May 23, 2022. What is LRRR Corps's depreciation expense in 2022? 5. Explain (in words, not calculations) what would be different is the Machine was placed in service on April 12, 2020. 6. If bonus depreciation is taken on all eligible assets, what is the total depreciation for 2020?
In 2020, LRRR Corp., a calendar year corporation, acquired and placed in service the assets listed below.
|
Asset |
Placed in Service |
Cost |
Recovery Period |
|
Computer |
8/21/2020 |
1,050,000 |
5 years |
|
Machine |
10/12/2020 |
1,000,000 |
7 years |
|
Warehouse |
12/2/2020 |
2,000,000 |
39 years |
Assume (1) no bonus depreciation, (2) no Section 179 expense for question.
1. What convention is used to
2. What is the total depreciation expense LRRR Corp. may deduct in 2020?
3. What is LRRR Corps's deprecation expense in 2021?
4. Assume LRRR Corp sold all assets on May 23, 2022. What is LRRR Corps's depreciation expense in 2022?
5. Explain (in words, not calculations) what would be different is the Machine was placed in service on April 12, 2020.
6. If bonus depreciation is taken on all eligible assets, what is the total depreciation for 2020?
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