On June 1, 2012, James Places in Service a New

question 67

Multiple Choice

On June 1, 2012, James places in service a new automobile that cost $40,000.The car is used 60% for business and 40% for personal use.(Assume this percentage is maintained for the life of the car.) James does take additional first-year depreciation.Determine the cost recovery deduction for 2012.

• A)$1,776.
• B)$1,836.
• C)$6,636.
• D)$8,000.
• E)None of the above.

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Definitions:

Rounded

The process of adjusting a numerical figure to its nearest specified place value, such as to the nearest whole number.

Significant Figures

The number of digits in a value that contribute to its precision, typically starting with the first non-zero digit.

Percent

A mathematical term that represents a number as a fraction of 100.

Cent

A unit of currency used in several nations, equivalent to 1/100th of a dollar, euro, or similar decimal-based currency.