Question: We purchase a new machine for $50,000 and it costs $2,500 to install. If we are in the MACRS 5 year class, what is the

We purchase a new machine for $50,000 and it costs $2,500 to install. If we are in the MACRS 5 year class, what is the cost basis after two years?

a.

$35,000

b.

$36,750

c.

$22,500

d.

$23,625

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