Serena Owns a Van That She Paid $22,000 for in 2011

question 79

Multiple Choice

Serena owns a van that she paid $22,000 for in 2011 and used exclusively for personal purposes until May 9, 2016, when she began using the van in her plumbing business. On May 9, 2016, a comparable van was selling for $13,000. Serena sells the van on October 28, 2018. Assuming that the van is 5-year MACRS property, it is not listed property, and that Serena did not make the Section 179 election to expense on the van, what is her allowable depreciation deduction in 2018?

• A)$749
• B)$1,248
• C)$1,267
• D)$2,112
• E)$2,496

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Definitions:

Environment of Risk

The context or situation that is characterized by uncertainty and potential for loss or harm in decision-making and actions.

Complete Information

A condition in decision-making where all relevant data and potential outcomes are known and accessible.

Probabilities

The measure of the likelihood that an event will occur, quantified as a number between 0 and 1, where 1 indicates certainty.

Escalation of Commitment

Escalation of commitment refers to the phenomenon where individuals or groups continue to invest in a decision or project despite evidence of its ineffectiveness or failure, often due to cognitive biases.