On June 1^st of the Current Year,Kayla and Ralph Purchased

question 18

Multiple Choice

On June 1^st of the current year,Kayla and Ralph purchased a rental beach house for $700,000.Of that amount,$400,000 was for the land value.How much depreciation deduction can they take in the current year? (You may need to refer to the depreciation tables. )

• A)$0.
• B)$5,910.
• C)$7,880.
• D)$13,790.

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Definitions:

Accounting Profit

The difference between total monetary revenue and total monetary costs, excluding the consideration of opportunity costs.

Explicit Costs

These are the direct, clear expenses related to business operations, such as salaries, utilities, and rent, that are easily quantifiable.

Accounting Profit

The difference between the total revenue and explicit costs of a firm, not accounting for implicit costs.

Economic Profit

The variance between a company's overall incomes and its combined explicit and implicit expenses.