Wellington Company Purchases a New Warehouse on August 24, 1994

question 49

Multiple Choice

Wellington Company purchases a new warehouse on August 24, 1994, for $1,000,000 exclusive of the cost allocated to the land) . What is the 2014 MACRS depreciation deduction?

• A) $11,900
• B) $25,640
• C) $31,740
• D) $48,694

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Definitions:

Cost Justification

The process of demonstrating that a proposed expenditure or investment is worthwhile based on the anticipated benefits exceeding the costs.

Quantity Discounts

Discounts offered to buyers for purchasing large volumes of goods, encouraging bulk purchasing.

Robinson-Patman Act

A U.S. antitrust law aimed at preventing discrimination in prices between different purchasers of commodities of like grade and quality, promoting fair competition.

Wholesaler Special

A promotion or discount offered exclusively to wholesale customers typically involving bulk purchases.