#29

Lax LLC purchased only one asset during the current year (a full 12 -month tax year). On August 26 Lax placed in service computer equipment (five-year property) with a basis of $32,000. Calculate the maximum depreciation expense for the current year (ignoring $179 and bonus depreciation). (Use MACRS Table 1.) Multiple Choice $4,400 $5,258 $5,400 $6,400 None of the choices are correct. Table 1 MACRS Half-Year Convention Ashburn reported a $105,175 net \$1231 gain in Year 6. Assuming Ashburn reported $56,500 of nonrecaptured \$1231 losses during Years 1 to 5 , what amount of Ashburn's net \$1231 gain for Year 6 , if any, is treated as ordinary income? Multiple Choice $0 $48,675 $56,500 $105,175 None of the choices are correct