In 2018, Richmond Corporation purchases and places into service a

In 2018, Richmond Corporation purchases and places into service a machine. Richmond elects Sec. 179 expensing for $1 million of its $1.2 mill ion cost. The machine has a 7-year MACRS recovery period. Assume the half-year convention applies.

a. What is Richmond's total depreciation deduction for the machine for each year of its recovery period if it elects out of bonus depreciation for 2018?

b. How would your answer to Part a change if Richmond does not elect out of bonus depreciation for 2018?
c. How would your answers to Parts a and b change if Richmond sells the machine for $430,000 on January 31, 2020? What is its gain or loss on the sale?

Corporation
A Corporation is a legal form of business that is separate from its owner. In other words, a corporation is a business or organization formed by a group of people, and its right and liabilities separate from those of the individuals involved. It may...

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