Better Built Toys Just Purchased Some MACRS 5-Year Property at a Cost

question 56

Multiple Choice

Better Built Toys just purchased some MACRS 5-year property at a cost of $230,000.Which of the following will correctly give you the book value of this equipment at the end of year 2?
MACRS 5-year property
Year Rate
1 20.00%
2 32.00%
3 19.20%
4 11.52%
5 11.52%
6 5.76%
I.52% of the asset cost
II.48% of the asset cost
III.68% of 80% of the asset cost
IV.the asset cost,minus 20% of the asset cost,minus 32% of 80% of the asset cost

• A)II only
• B)III and IV only
• C)I and III only
• D)II and IV only
• E)I, II, III, and IV

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Definitions:

Core Capabilities

Fundamental skills, knowledge, and expertise that give an organization a competitive advantage in its field.

Global Licensing

A cross-border agreement that allows companies in different countries to use the properties (such as patents, trademarks, or technology) of another.

Turnkey Operation

A type of project that is constructed so that it can be sold or handed over to the buyer in a ready-to-use condition.

Chemical Factory

A facility where chemical processes are carried out, especially for manufacturing chemicals on a large scale.