Comprehenslve Problem $10-77($LO $10-1,$ LO $10-2,$ LO $10-3,$ LO $10-4,$ LO $10-5)($AlgO$)$

$[$The following information applles to the questions alisplayed below.$]$

While completing undergraduate school work in Information systems, Dallin Bourne and Michael Banks decided to start a

technology support company called eSys Answers. During year $1,$ they bought the following assets and incurred the

following start$-$up fees:

In April of year $2$ they decided to purchase a customer list from a company providing virtually the same services, started

by fellow Information systems students preparing to graduate. The customer list cost $$13,600,$ and the sale was completed

on April $30.$ Durling thelr summer break, Dallin and Michael passed on Internship opportunltles in an attempt to really grow

their business Into something they could do full time after graduation. In the summer, they purchased a small van $($for

transportation, not considered a luxury auto$)$ and a pinball machine $($to help attract new employees$).$ They bought the van

on June $15,$ Year $2,$ for $$35,000$ and spent $$5,000$ getting it ready to put Into service. The pinball machine cost $$6,000$

and was placed in service on July $1,$ Year $2.$

Assume that eSys Answers does not clalm any $5179$ expense or bonus depreclation. $($Use MACRS Table $1,$ Table $2$ Table $3.$

Table $4$ and Table $5.)$

Note: Round your intermedlate calculations and final answers to the nearest whole dollar amount.

Comprehenslve Problem $10-77$ Part a and Part c $($Algo$)$

Required:

a$.$ What are the maximum cost recovery deductions for eSys Answers for Year $1$ and Year $2?$

c$.$ What is eSys Answers' basis In each of Its assets at the end of Year $2?$

Complete this question by entering your answers in the tabs below.

What is eSys Answers' basis in each of its assets at the end of Year $2?$