David Acquired an Automobile for $30,000 for Use in His

question 1063

Multiple Choice

David acquired an automobile for $30,000 for use in his unincorporated business at the beginning of 2018 and used the standard mileage rate method in 2018. He plans to switch to the actual expense method for 2019. The automobile was used 25,000 miles in 2018. What is the amount of the adjusted basis of the automobile for purposes of computing depreciation in 2019?

• A) $20,000
• B) $16,625
• C) $30,000
• D) $23,750