The Only Asset Bill Purchased During 2017 Was a New

question 48

Multiple Choice

The only asset Bill purchased during 2017 was a new seven-year class asset. The asset, which was listed property, was acquired on June 17 at a cost of $50,000. The asset was used 40% for business, 30% for the production of income, and the rest of the time for personal use. Bill always elects to expense the maximum amount under § 179 whenever it is applicable. The net income from the business before the § 179 deduction is $100,000. Determine Bill's maximum deduction with respect to the property for 2017.

• A)$1,428
• B)$2,499
• C)$26,749
• D)$33,375
• E)None of the above

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Definitions:

Sales Activity

The actions and processes involved in the selling of goods or services, including promotion, negotiation, and distribution.

Ending Work in Process

The value of partially completed goods at the end of an accounting period, comprising material, labor, and overhead costs.

Finished Goods Inventory

Unsold goods that are available and ready for purchase in the market.

Cost of Goods Sold

This refers to the direct costs attributable to the production of the goods sold by a company, including the cost of the materials and labor directly used to create the good.