A global positioning system (GPS) receiver is purchased for $2,000. The IRS informs your company that the useful (class) life of the system is six years. The expected market (salvage) value is $100 at the end of year six. a. Use the straight line method to calculate depreciation in year two. b. Use the 200% declining balance method to calculate the cumulative depreciation through year three. c. Use the MACRS method to calculate the cumulative depreciation through year four d. What is the book value of the GPS receiver at the end of year three when straight line depreciation is used? Click the icon to view the summary of the principal features of GDS under MACRS Click the icon to view the GDS Recovery Rates (rk). a. Using the SL method, the depreciation amount in year two is $317. (Round to the nearest dollar.) b. Using the 200% DB method, the the cumulative depreciation through year three is $ (Round to the nearest dollar.) MACRS (GDS) Property Classes and Primary Methods for Calculating Depreciation \begin{tabular}{|c|c|c|} \hline \multicolumn{3}{|c|}{ Deductions } \\ \hline \begin{tabular}{l} GDS Property Class and \\ Depreciation Method \\ \end{tabular} & \begin{tabular}{c} Class Life (Useful \\ Life) \\ \end{tabular} & Special Rules \\ \hline \begin{tabular}{l} 3-year, 200% DB with \\ switchover to SL \end{tabular} & \begin{tabular}{l} Four years or \\ less \end{tabular} & \begin{tabular}{l} Includes some race horses and tractor \\ units for over-the-road use \end{tabular} \\ \hline 5-year, 200% DB with & More than 4 & Includes cars and light trucks, \\ \hline switchover to SL & \begin{tabular}{l} years to less \\ than 10 \end{tabular} & \begin{tabular}{l} semiconductor manufacturing \\ equipment, qualified technological \\ equipment, computer-based \\ central office switching equipment, \\ some renewable and biomass \\ power facilities, and research and \\ development property \end{tabular} \\ \hline \begin{tabular}{l} 7-year, 200% DB with \\ switchover to SL \end{tabular} & \begin{tabular}{l} 10 years to less \\ than 16 \end{tabular} & \begin{tabular}{l} Includes single-purpose agricultural \\ and horticultural structures and \\ railroad track Includes office \\ furniture and fixtures, and property \\ not assigned to a property class \end{tabular} \\ \hline \begin{tabular}{l} 10-year, 200% DB with \\ switchover to SL \end{tabular} & \begin{tabular}{l} 16 years to less \\ than 20 \end{tabular} & \begin{tabular}{l} Includes vessels, barges, tugs, \\ and similar water transportation \\ equipment. \end{tabular} \\ \hline \begin{tabular}{l} 15-year, 150% DB with \\ switchover to SL \end{tabular} & \begin{tabular}{l} 20 years to less \\ than 25 \end{tabular} & \begin{tabular}{l} Includes sewage treatment plants, \\ telephone distribution plants, and \\ equipment for two-way voice and \end{tabular} \\ \hline \end{tabular} GDS Recovery Rates (rk) for the Six Personal Property Classes \begin{tabular}{|c|c|c|c|c|c|c|} \hline \multirow[b]{2}{*}{ Year } & \multicolumn{6}{|c|}{ Recovery Period (and Property Class) } \\ \hline & 3 -year 2 & 5yean & 7-year a & 10-year & 15-yeait & 20 -year b \\ \hline 1 & 0.3333 & 0.2000 & 0.1429 & 0.1000 & 0.0500 & 0.0375 \\ \hline 2 & 0.4445 & 0.3200 & 0.2449 & 0.1800 & 0.0950 & 0.0722 \\ \hline 3 & 0.1481 & 0.1920 & 0.1749 & 0.1440 & 0.0855 & 0.0668 \\ \hline 4 & 0.0741 & 0.1152 & 0.1249 & 01152 & 0.0770 & 0.0618 \\ \hline 5 & & 0.1152 & 0.0893 & 0.0922 & 0.0693 & 00571 \\ \hline 6 & & 0.0576 & 0.0892 & 0.0737 & 0.0623 & 0.0528 \\ \hline 7 & & & 0.0893 & 0.0655 & 00590 & 0.0489 \\ \hline 8 & & & 0.0446 & 0.0655 & 0.0590 & 0.0452 \\ \hline 9 & & & & 0.0656 & 0.0591 & 0.0447 \\ \hline 10 & & & & 0.0655 & 0.0590 & 0.0447 \\ \hline 11 & & & & 0.0328 & 0.0591 & 0.0446 \\ \hline 12 & & & & & 0.0590 & 0.0446 \\ \hline 13 & & & & & 0.0591 & 0.0446 \\ \hline 14 & & & & & 0.0590 & 0.0446 \\ \hline 15 & & & & & 0.0591 & 0.0446 \\ \hline 16 & & & & & 0.0295 & 0.0446 \\ \hline 17 & & & & & & 0.0446 \\ \hline 18 & & & & & & 0.0446 \\ \hline 19 & & & & & & 0.0446 \\ \hline on & & & & & & ODMAF \\ \hline \end{tabular}