Bhaskar Purchased a New Factory Building on September 10,2013,for $3,700,000

question 38

Multiple Choice

Bhaskar purchased a new factory building on September 10,2013,for $3,700,000.Five hundred thousand of the purchase price was allocated to the land.He elected the alternative depreciation system (ADS) .Determine the cost recovery deduction for 2014.

• A)$23,328.
• B)$80,000.
• C)$82,048.
• D)$92,500.
• E)None of the above.

Understand the fundamental components of the FASB conceptual framework.

Identify and describe the common forms of business ownership and their characteristics.

Recognize the role and influence of regulatory bodies like the SEC and IASB on accounting practices.

Understand the significance and application of the accounting equation.

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Definitions:

Substitute

A product or service that can be used in place of another to satisfy similar needs or demands.

Industry Entry

The process of a new competitor or business entering into a market or industry.

Demand

The quantity of a good or service that consumers are willing and able to purchase at various prices at a given time.

Long Run

That period of time for which there are no fixed factors of production: Firms can increase or decrease the scale of operation, and new firms can enter and/or existing firms can exit the industry.