Harris Corp. is a technology start-up currently in its second year of operations. The company didn't...
Fantastic news! We've Found the answer you've been seeking!
Question:
Transcribed Image Text:
Harris Corp. is a technology start-up currently in its second year of operations. The company didn't purchase any assets this year but purchased the following assets in the prior year: Placed in Asset Service Basis Office equipment Manufacturing equipment August 14 April 15 $ 10,800 76,000 24,000 Computer system June 1 $ 110,800 Total Harris did not know depreciation was tax deductible until it hired an accountant this year and didn't claim any depreciation deduction in its first year of operation. (Use MACRS Table 1 and Table 2.) a. What is the maximum amount of depreciation deduction Harris Corp. can deduct in its second year of operation? (Leave no answer blank. Enter zero if applicable.) Depreciation deduction b. What is the basis of the office equipment at the end of the second year? (Leave no answer blank. Enter zero if applicable.) Basis of office equipment Table 1 MACRS Half-Year Convention Depreciation Rate for Recovery Period 3-Year 5-Year 7-Year 10-Year 15-Year 20-Year Year 1 Year 2 33.33% 20.00% 14.29% 10.00% 5.00% 3.750% 44.45 32.00 24.49 18.00 9.50 7.219 Year 3 14.81 19.20 17.49 14.40 8.55 6.677 Year 4 7.41 11.52 12.49 11.52 7.70 6.177 Year 5 11.52 8.93 9.22 6.93 5.713 Year 6 Year 7 Year 8 5.76 8.92 7.37 6.23 5.285 8.93 6.55 5.90 4.888 4.46 6.55 5.90 4.522 Year 9 6.56 5.91 4.462 Year 10 Year 11 Year 12 6.55 5.90 4.461 3.28 5.91 4.462 5.90 4.461 Year 13 5.91 4.462 Year 14 5.90 4.461 Year 15 5.91 4.462 Year 16 2.95 4.461 TABLE 2a MACRS Mid-Quarter Convention: For proper Depreciation Rate for Recovery Period 5-Year 7-Year Year 1 35.00% 25.00% Year 2 26.00 21.43 Year 3 15.60 15.31 Year 4 11.01 10.93 Year 5 11.01 8.75 Year 6 1.38 8.74 Year 7 8.75 Year 8 1.09 TABLE 2b MACRS Mid-Quarter Convention: For prope Depreciation Rate for Recovery Period 5-Year 7-Year Year 1 25.00% 17.85% Year 2 30.00 23.47 Year 3 18.00 16.76 Year 4 11.37 11.97 Voom 11. 27 O 07 Harris Corp. is a technology start-up currently in its second year of operations. The company didn't purchase any assets this year but purchased the following assets in the prior year: Placed in Asset Service Basis Office equipment Manufacturing equipment August 14 April 15 $ 10,800 76,000 24,000 Computer system June 1 $ 110,800 Total Harris did not know depreciation was tax deductible until it hired an accountant this year and didn't claim any depreciation deduction in its first year of operation. (Use MACRS Table 1 and Table 2.) a. What is the maximum amount of depreciation deduction Harris Corp. can deduct in its second year of operation? (Leave no answer blank. Enter zero if applicable.) Depreciation deduction b. What is the basis of the office equipment at the end of the second year? (Leave no answer blank. Enter zero if applicable.) Basis of office equipment Table 1 MACRS Half-Year Convention Depreciation Rate for Recovery Period 3-Year 5-Year 7-Year 10-Year 15-Year 20-Year Year 1 Year 2 33.33% 20.00% 14.29% 10.00% 5.00% 3.750% 44.45 32.00 24.49 18.00 9.50 7.219 Year 3 14.81 19.20 17.49 14.40 8.55 6.677 Year 4 7.41 11.52 12.49 11.52 7.70 6.177 Year 5 11.52 8.93 9.22 6.93 5.713 Year 6 Year 7 Year 8 5.76 8.92 7.37 6.23 5.285 8.93 6.55 5.90 4.888 4.46 6.55 5.90 4.522 Year 9 6.56 5.91 4.462 Year 10 Year 11 Year 12 6.55 5.90 4.461 3.28 5.91 4.462 5.90 4.461 Year 13 5.91 4.462 Year 14 5.90 4.461 Year 15 5.91 4.462 Year 16 2.95 4.461 TABLE 2a MACRS Mid-Quarter Convention: For proper Depreciation Rate for Recovery Period 5-Year 7-Year Year 1 35.00% 25.00% Year 2 26.00 21.43 Year 3 15.60 15.31 Year 4 11.01 10.93 Year 5 11.01 8.75 Year 6 1.38 8.74 Year 7 8.75 Year 8 1.09 TABLE 2b MACRS Mid-Quarter Convention: For prope Depreciation Rate for Recovery Period 5-Year 7-Year Year 1 25.00% 17.85% Year 2 30.00 23.47 Year 3 18.00 16.76 Year 4 11.37 11.97 Voom 11. 27 O 07
Expert Answer:
Related Book For
Financial Statement Analysis
ISBN: 978-0078110962
11th edition
Authors: K. R. Subramanyam, John Wild
Posted Date:
Students also viewed these accounting questions
-
In Year 2006, Cough.com is in its second year of operations. Cough.com produces children's cough medicine. Industry sales of children's cough medicine for 2005 totaled $3 billion. For 2005, Cough.com...
-
In its second year of operations, Memories, Inc. has decided to expand the product line by producing replicas of historic buildings. These replicas will require the purchase of new building molds at...
-
Discount Computers is in its second year of business providing computer repair services in the local community and reselling used computers on the Internet. The company is owned by 10 investors, each...
-
Solve the triangles with the given parts. a = 7.86, b = 2.45, C = 2.5
-
Advances in the field of nanotechnology have made it possible to construct chains of single metal atoms linked one to the next. Physicists are particularly interested in the ability of such chains to...
-
The arc-on time is a measure of efficiency in an arc welding operation. As indicated in our discussion of arc welding in Section 8.5.2, typical arc-on times in manual welding range between 20% and...
-
Compare and contrast components to objects.
-
Grim Corporation has income and expenses for its current fiscal year, recorded under generally accepted accounting principles, as shown in the following schedule. In addition, a review of Grims books...
-
Part A: In January of 2024, two taxpayers decided to begin a new business venture that produces premium dog food. They form the venture as a partnership. Aaron (age 33, single, and currently facing a...
-
Sports Performance Increased (BPI) Ltd. is a relatively new company that created various sports apps designed for athletes. These apps can be downloaded onto a mobile device and assist users in...
-
Janurary 1, 2018, Ata Inc. received a $5,000 from a customer for future work. Ata completed $2,000 of the work by January 31. Make the original and the adjusting journal entries. What is the ending...
-
Refer to the figure for heterodyne interferometer. Complete the figure with values for fl, f2, Af calculated and indicated at the appropriate place based on the following: a. 633nm laser used...
-
3. Consider the following tapered rod of uniform modulus of elasticity E, uniform density p, length L, and non-uniform circular cross-section A = A (2 - x1/). The rod is loaded by gravity acting in...
-
a. b. C. The following information pertains to a production schedule for lettuce harvesting using 3 units of capital. (15 points) Workers Output Stage of Production 0 20 50 0 1 2 3 4 5 6 7 8 90 120...
-
Consider a potential vortex positioned a distance a above a horizontal wall, immersed in a free stream parallel to the wall with speed U as shown in the figure. The vortex has clockwise circulation...
-
Consider the 2D bearing depicted in the figure below. It consists of two faces parallel to the surface underneath it, each of length L. One face is a height h from the surface, and the other is h...
-
The following data have been extracted from the records of Puzzle Incorporated: Production level, in units Variable costs Fixed costs Mixed costs February 9,700 August 19,400 $ 24,250 ? $ 7 39,300...
-
Write a paper detailing a geographic information system (GIS) of your own design that would utilize data in an original manner.
-
Refer to the annual report of Campbell Soup Company in Appendix A. Required: a. Determine the book value per share of Campbell Soup's common stock for Year 11. b. Identify the par value of Campbell...
-
Describe the required financial statement disclosures for financial instruments with off-balance-sheet risk of loss. How might these disclosures be used to assist financial analysis?
-
What are other postretirement employee benefits (OPEBs)? What are the major differences between pensions and OPEBs?
-
Calculate the volatility and the current price of oil futures implied by the call 1600 August and the call 1700 August of Figure 19.8 by using the Black-Scholes formula with \(T=.25\). OIL CRUDE OIL...
-
A company issues a \(10 \%\) coupon bond that matures in 5 years. However, this company is in trouble, and it is estimated that each year there is a probability of .1 that it will default that year....
-
Consider a continuous-time environment, with \(e\) as a variable outside of the market. (a) Suppose the final payoff is \(V\left(x_{e}, T ight)=x_{e}(T)\). Find \(V\left(x_{e}, t ight)\). (b) Find a...
Study smarter with the SolutionInn App