Everest Corp

question 98

Essay

Everest Corp.acquires a machine (seven-year property)on January 10,2017 at a cost of $2,042,000.Everest makes the election to expense the maximum amount under Sec.179.The property is not eligible for bonus depreciation.
a.Assume that the taxable income from trade or business is $1,500,000.
(1)What is the amount of the Sec.179 expensing deduction for the current year?
(2)What is the amount of the Sec.179 carryover to the next tax year?
(3)What is the amount of depreciation allowed?
b.Assume instead that the taxable income from trade or business is $400,000.
(1)What is the amount of the Sec.179 expensing deduction for the current year?
(2)What is the amount of the Sec.179 carryover to the next tax year?
(3)What is the amount of depreciation allowed this year?

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Definitions:

Microscope

An instrument used to view objects that are too small to be seen by the naked eye, magnifying tiny details for study or observation.

Substage

A division or phase within a larger stage or process, often indicating a specific part of a broader developmental or operational sequence.

Condenser

A device used to condense a gas or vapor into a liquid, commonly found in air conditioning and refrigeration systems.

Objective

An objective is a specific, measurable, attainable, relevant, and time-bound goal that an individual or organization aims to achieve.