Q: On November 4, 2013, Blue Company acquired an asset (
On November 4, 2013, Blue Company acquired an asset (27.5-year residential real property) for $200,000 for use in its business. In 2013 and 2014, respectively, Blue took $642 and $5,128 of cost recove...
See AnswerQ: Debra acquired the following new assets during 2015. /
Debra acquired the following new assets during 2015. Determine Debraâs cost recovery deductions for the current year. Debra does not elect immediate expensing under § 179...
See AnswerQ: Lori, who is single, purchased 5-year class property
Lori, who is single, purchased 5-year class property for $200,000 and 7-year class property for $400,000 on May 20, 2015. Lori expects the taxable income derived from her business (without regard to t...
See AnswerQ: Olga is the proprietor of a small business. In 2015,
Olga is the proprietor of a small business. In 2015, the business’s income, before consideration of any cost recovery or § 179 deduction, is $250,000. Olga spends $600,000 on new 7-year class assets a...
See AnswerQ: Jabari Johnson is considering acquiring an automobile at the beginning of 2015
Jabari Johnson is considering acquiring an automobile at the beginning of 2015 that he will use 100% of the time as a taxi. The purchase price of the automobile is $35,000. Johnson has heard of cost r...
See AnswerQ: On October 15, 2015, Jon purchased and placed in service
On October 15, 2015, Jon purchased and placed in service a used car. The purchase price was $25,000. This was the only business-use asset Jon acquired in 2015. He used the car 80% of the time for busi...
See AnswerQ: On June 5, 2014, Leo purchased and placed in service
On June 5, 2014, Leo purchased and placed in service a new car that cost $20,000. The business-use percentage for the car is always 100%. Leo claims any available additional first-year depreciation. C...
See AnswerQ: On May 28, 2015, Mary purchased and placed in service
On May 28, 2015, Mary purchased and placed in service a new $20,000 car. The car was used 60% for business, 20% for production of income, and 20% for personal use in 2015. In 2016, the usage changed t...
See AnswerQ: Jamie purchased $100,000 of new office furniture for her
Jamie purchased $100,000 of new office furniture for her business in June of the current year. Jamie understands that if she elects to use ADS to compute her regular income tax, there will be no diffe...
See AnswerQ: Martin transfers real estate with an adjusted basis of $260,
Martin transfers real estate with an adjusted basis of $260,000 and fair market value of $350,000 to a newly formed corporation in exchange for 100% of the stock. The corporation assumes the liability...
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