Deirdre's Business Purchased Two Assets During the Current Year (A

question 87

Multiple Choice

Deirdre's business purchased two assets during the current year (a full 12-month tax year) . Deirdre placed in service computer equipment (5-year property) on January 20 with a basis of $15,000 and machinery (7-year property) on October 1 with a basis of $15,000. Calculate the maximum depreciation expense, rounded to a whole number (ignoring §179 and bonus depreciation) :

• A) $1,286
• B) $5,144
• C) $5,786
• D)$6,000
• E)None of these

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Definitions:

Face Value

The nominal or original value stated on a financial instrument, such as a bond or currency bill, not necessarily its current market value.

Possession

The state of having, owning, or controlling something, either tangibly or legally.

Holder In Due Course

A legal term for a person who has obtained a negotiable instrument in good faith and for value, and thus has certain rights above the original payee.

Breached The Contract

The act of failing to perform obligations stipulated in a contract, leading to a violation of the agreement.