According to the Modified Accelerated Cost Recovery System (MACRS), Automobiles

question 182

Multiple Choice

According to the Modified Accelerated Cost Recovery System (MACRS) , automobiles are to be placed with other assets that have a five-year class life. Assume Dallmeyer Digital bought a car in December 2004. What would be the last year in which it would take recognize depreciation on the vehicle?

• A)2004
• B)2009
• C)2010
• D)2011

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Definitions:

Default Risk

The risk that a borrower will not make the required payments on their debt obligations.

Maturity Risk

The risk associated with the changing value of securities due to the time remaining until their maturity date.

Yield to Maturity

The total return anticipated on a bond if it is held until the maturity date, factoring in the current price, par value, coupon yield, and time to maturity.

Coupon Rate

Each year, the interest rate a bond yields, expressed in terms of the percentage of its face value.