Under MACRS, an Asset Which Originally Cost $100,000, Incurred Installation

question 99

Multiple Choice

Under MACRS, an asset which originally cost $100,000, incurred installation costs of $10,000, and has an estimated salvage value of $25,000, is being depreciated using a 5-year normal recovery period. What is the depreciation expense in year 1?

• A) $15,000
• B) $12,750
• C) $11,250
• D) $22,000

Recognize different business formations and their implications on liability and tax.

Understand the taxation and liability structure for different types of business entities.

Recognize the process and requirements for a business operating in multiple states.

Comprehend the components and legal implications of franchising.

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Definitions:

Private Saving

The portion of individual or household income that is not consumed or taxed, often saved or invested for future use.

National Saving

The total of private and public savings in a country, representing the portion of national income not consumed or spent by the government.

Closed Economy

A type of economic system where a country does not engage in trade with other countries, aiming to be self-sufficient.

Long-Term Bonds

Are debt securities with a maturity date extending beyond ten years, offering an investor fixed interest payments over a long duration.