Scrap-Happy owns a computer (five-year MACRS recovery period) that it purchased two years ago for $1,200. For financial statement purposes, the computer depreciates over three years using the half-year convention and straight-line method, with no salvage value. What are the adjusted book and tax bases for the computer (after two years of depreciation)?

Please, can you explain more about the differences between the book and tax basis( how you the numbers in detail) ?

Thank you in advance!