An Asset (Not an Automobile) Placed in Service in June

question 15

Multiple Choice

An asset (not an automobile) placed in service in June 2019 has a depreciable basis of $2,555,000, a recovery period of 5 years, and is the only asset placed in service during the year. Assuming bonus depreciation is not used, a half-year convention, and the expensing election is made for the maximum eligible amount, what is the amount of cost that can be deducted in 2019 assuming the business earned taxable income of $1,000,000 before deducting any cost recovery on the asset?

• A)$407,000
• B)$500,000
• C)$1,000,000
• D)$1,407,000
• E)$2,000,000

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Definitions:

Ethologists

Specialists who study animal behavior in natural environments, focusing on how animals interact with each other and their surroundings.

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The biological process by which species of organisms change over time through variation, genetic mutation, and natural selection.

Environment

The surroundings or conditions in which a person, animal, or plant lives or operates, including natural, social, and cultural factors.

Zone of Proximal Development

A concept developed by Vygotsky describing the difference between what a learner can do without help and what they can achieve with guidance and encouragement from a skilled partner.