Suppose a computer software developer for a certain company purchased a computer system for 55,000 on April 27, 2017. The computer system is used for business 100% of the time. The Accountant for the company elected to take 20,000 section 179 deduction and the asset qualified for a special depreciation allowance . A- what was the basis for depreciation in dollars of the computer system . Table 17–4. B- what was the amount in dollars for the first year‘s appreciation use an MACRSC table 17–1 and 17–2 . TABLE 17-4 Special Depreciation Allowance:9:Certain QualifiedAsset Placed into Service4September 11, 2001-May 5, 2003May 6, 2003-January 1, 2005December 31, 2007-September 27, 2017September 28, 2017-December 31, 202280F4MacBook AirAAF7Special Allowance30%50%50%100%DIIFRDD(1)F11F12 TABLE 17-1 MACRS Property Classes (Recovery Period) General Depreciation System3-Year Property (3 years)5-Year Property (5 years)Automobiles and taxisBuses and trucksOver-the-road tractorsSome horses and hogsSpecial handling devices for themanufacture of food and beveragesSpecialty tools used in the manufactureof motor vehiclesComputers and peripheralsOffice machinerySpecialty tools used in the manufactureof finished products made of plastic,rubber, glass, and metal10-Year Property (10 years)Vessels, barges, and tugsSingle-purpose agricultural structuresTrees and vines bearing fruits or nutsAssets used in the production of grain, sugar,and vegetable oil productsAssets used in petroleum refiningAssets used in the manufacture and repair ofships, boats, and marine drilling rigs25-Year Property (25 years)Municipal sewersCertain water utility property integral tothe gathering, treatment, or commercialdistribution of waterBreeding or dairy cattle, sheep and goatsAirplanes (except those in commercial use)Trailers and trailer-mounted containersAssets used in constructionAssets used in the manufacture of knittedgoods, textile yarns, carpets, medicaland dental supplies, chemicals, andelectronic componentsAssets used in radio and televisionbroadcasting, and CATV15-Year Property (15 years)Depreciable improvements made to land,such as shrubbery, fences, roads, andbridgesAssets used to manufacture cementGas and petroleum utility pipelinesIndustrial steam and electric generation and/or distribution systemsWater taxis and ferry boatsResidential Rental Property (27.5 years)This is any building or structure, such as arental home (including a mobile home), if80% of its gross rental income for the taxyear is from dwelling units. A dwellingunit is a house or an apartment used toprovide living accommodations.7-Year Property (7 years)Office furniture and fixturesRailroad cars and enginesCommercial airplanesAssets used in the manufacture of wood,pulp, and paper productsAssets used in printing and publishingAssets used in the production of tobacco,leather, stone, and steel productsAssets used in the production of sportinggoods, toys, jewelry, and musicalinstrumentsAssets used in theme and amusementparks, theaters, concert halls, andminiature golf courses20-Year Property (20 years)Farm buildingsRailroad structures and improvementsCommunication cable and long-linesystemsWater, electric, gas, and steam utilityplants and equipmentNonresidential Real Property (39 years)This is property such as an officebuilding, a store, or a warehouse thatis not residential rental property.

Question

Suppose a computer software developer for a certain company purchased a computer system for 55,000 on April 27, 2017.  ￼ The computer system is used for business 100% of the time.￼  The ￼ Accountant for the company elected to take 20,000 section 179 deduction and the asset qualified for a special depreciation allowance .  ￼A- what was the basis for depreciation in dollars ￼ of the computer system . Table 17–4. ￼B- what was the amount in dollars for the first year‘s appreciation use an MACRSC table 17–1 and 17–2 . TABLE 17-4 Special Depreciation Allowance:9:Certain QualifiedAsset Placed into Service4September 11, 2001-May 5, 2003May 6, 2003-January 1, 2005December 31, 2007-September 27, 2017September 28, 2017-December 31, 202280F4MacBook AirAAF7Special Allowance30%50%50%100%DIIFRDD(1)F11F12 TABLE 17-1 MACRS Property Classes (Recovery Period) General Depreciation System3-Year Property (3 years)5-Year Property (5 years)Automobiles and taxisBuses and trucksOver-the-road tractorsSome horses and hogsSpecial handling devices for themanufacture of food and beveragesSpecialty tools used in the manufactureof motor vehiclesComputers and peripheralsOffice machinerySpecialty tools used in the manufactureof finished products made of plastic,rubber, glass, and metal10-Year Property (10 years)Vessels, barges, and tugsSingle-purpose agricultural structuresTrees and vines bearing fruits or nutsAssets used in the production of grain, sugar,and vegetable oil productsAssets used in petroleum refiningAssets used in the manufacture and repair ofships, boats, and marine drilling rigs25-Year Property (25 years)Municipal sewersCertain water utility property integral tothe gathering, treatment, or commercialdistribution of waterBreeding or dairy cattle, sheep and goatsAirplanes (except those in commercial use)Trailers and trailer-mounted containersAssets used in constructionAssets used in the manufacture of knittedgoods, textile yarns, carpets, medicaland dental supplies, chemicals, andelectronic componentsAssets used in radio and televisionbroadcasting, and CATV15-Year Property (15 years)Depreciable improvements made to land,such as shrubbery, fences, roads, andbridgesAssets used to manufacture cementGas and petroleum utility pipelinesIndustrial steam and electric generation and/or distribution systemsWater taxis and ferry boatsResidential Rental Property (27.5 years)This is any building or structure, such as arental home (including a mobile home), if80% of its gross rental income for the taxyear is from dwelling units. A dwellingunit is a house or an apartment used toprovide living accommodations.7-Year Property (7 years)Office furniture and fixturesRailroad cars and enginesCommercial airplanesAssets used in the manufacture of wood,pulp, and paper productsAssets used in printing and publishingAssets used in the production of tobacco,leather, stone, and steel productsAssets used in the production of sportinggoods, toys, jewelry, and musicalinstrumentsAssets used in theme and amusementparks, theaters, concert halls, andminiature golf courses20-Year Property (20 years)Farm buildingsRailroad structures and improvementsCommunication cable and long-linesystemsWater, electric, gas, and steam utilityplants and equipmentNonresidential Real Property (39 years)This is property such as an officebuilding, a store, or a warehouse thatis not residential rental property.

Accepted Answer

Depreciation refers to decrease in the monetary value of an asset due to obsolescence, wear and…