Karane Enterprises, a calendar-year manufacturer based in College Station, Texas, began business in 2018. In the process
Question:
Karane Enterprises, a calendar-year manufacturer based in College Station, Texas, began business in 2018. In the process of setting up the business, Karane has acquired various types of assets. Below is a list of assets acquired during 2018: Asset Cost Date Placed in Service Office furniture $ 150,000 02/03/2018 Machinery 1,560,000 07/22/2018 Used delivery truck* 40,000 08/17/2018 *Not considered a luxury automobile. During 2018, Karane was very successful (and had no §179 limitations) and decided to acquire more assets in 2019 to increase its production capacity. These are the assets acquired during 2019: Asset Cost Date Placed in Service Computers & info. system $ 400,000 03/31/2019 Luxury auto† 80,000 05/26/2019 Assembly equipment 1,200,000 08/15/2019 Storage building 700,000 11/13/2019 †Used 100% for business purposes. Karane generated taxable income in 2019 of $1,732,500 for purposes of computing the §179 expense. (Use MACRS Table 1, Table 2, Table 3, Table 4, Table 5, and Exhibit 10-10.) (Leave no answer blank. Enter zero if applicable. Input all the values as positive numbers.) rev: 10_25_2019_QC_CS-188019 b. Compute the maximum 2019 depreciation deductions, including §179 expense (ignoring bonus depreciation).
Karane Enterprises, a calendar-year manufacturer based in College Station, Texas, began business in 2018. In the process of setting up the business, Karane has acquired various types of assets. Below is a list of assets acquired during 2018:
Asset | Cost | Date Placed in Service | |
Office furniture | $ | 150,000 | 02/03/2018 |
Machinery | 1,560,000 | 07/22/2018 | |
Used delivery truck* | 40,000 | 08/17/2018 | |
*Not considered a luxury automobile.
During 2018, Karane was very successful (and had no §179 limitations) and decided to acquire more assets in 2019 to increase its production capacity. These are the assets acquired during 2019:
Asset | Cost | Date Placed in Service | |
Computers & info. system | $ | 400,000 | 03/31/2019 |
Luxury auto† | 80,000 | 05/26/2019 | |
Assembly equipment | 1,200,000 | 08/15/2019 | |
Storage building | 700,000 | 11/13/2019 | |
†Used 100% for business purposes.
Karane generated taxable income in 2019 of $1,732,500 for purposes of computing the §179 expense. (Use MACRS Table 1, Table 2, Table 3, Table 4, Table 5, and Exhibit 10-10.) (Leave no answer blank. Enter zero if applicable. Input all the values as positive numbers.)
rev: 10_25_2019_QC_CS-188019
b. Compute the maximum 2019 depreciation deductions, including §179 expense (ignoring bonus depreciation).
Essentials of Federal Taxation 2019
ISBN: 9781260190045
10th edition
Authors: Brian Spilker, Benjamin Ayers, John Robinson, Edmund Outslay, Ronald Worsham, John Barrick, Connie Weaver