In 2013,Henry Purchases $2,050,000 of Equipment with a Useful Life

question 12

Multiple Choice

In 2013,Henry purchases $2,050,000 of equipment with a useful life of 7 years.The taxable income of the business is $100,000.What is Henry's maximum depreciation deduction in 2013? (Henry elects out of bonus depreciation.)

• A)$335,000
• B)$378,655
• C)$500,000
• D)$678,640
• E)$721,495

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Definitions:

Reship Conforming Goods

The act of sending goods that meet the contractual specifications after initially shipping non-conforming goods.

Notice of Rejection

A formal notification indicating that an offer or proposal has been declined.

Revoke Acceptance

In contract law, the right of a buyer to reject goods after initial acceptance if they substantially fail to conform to the contract or because of a latent defect.

Nonconformity

The failure of a product or service to meet specified standards or expectations, typically resulting in a breach of warranty.