Crouch LLC Placed in Service on May 19, 2020, Machinery

question 106

Multiple Choice

Crouch LLC placed in service on May 19, 2020, machinery and equipment (seven-year property) with a basis of $3,200,000. Assume that Crouch has sufficient income to avoid any limitations. Calculate the maximum depreciation deduction including §179 expensing (but ignoring bonus depreciation) . (Use MACRS Table 1.)

• A)$457,280
• B)$430,000
• C)$825,833
• D)$1,040,000
• E)None of the choices are correct.

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Definitions:

No Shirking Constraint

A concept in labor economics that suggests higher wages motivate employees to work harder, reducing shirking on the job.

Efficiency Wage Rate

A wage rate set above the market-clearing level by employers to boost worker productivity, discourage shirking, and reduce turnover.

Wage Rigidity

Wage rigidity refers to the phenomenon where wages do not adjust quickly or easily to changes in labor market conditions, often due to contracts, norms, or regulations.

No Shirking Constraint

An economic principle suggesting that wages must be set at a level that discourages employees from shirking their duties.