For a New Car That Is Used Predominantly in Business

question 101

True/False

For a new car that is used predominantly in business, the "luxury auto" limit depends on whether the taxpayer takes
MACRS or straight-line depreciation.

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Definitions:

Net Income

The total revenue of a business minus total expenses, indicating the company's profit after all expense deductions.

Income Statement

A financial statement that reports a company's revenues and expenses over a specific period, showing the net profit or loss.

Adjustments Column

Part of an accounting worksheet where entries are made to update account balances before preparing financial statements.

Retained Earnings

The portion of a company's profits that is kept or retained and not paid out as dividends to shareholders. Often reinvested in the business or used to pay off debt.