Crouch LLC Placed in Service on May 19,2013 Machinery and Equipment

question 55

Multiple Choice

Crouch LLC placed in service on May 19,2013 machinery and equipment (7-year property) with a basis of $2,200,000.Assume that Crouch has sufficient income to avoid any limitations.Calculate the maximum depreciation expense including §179 expensing (but ignoring bonus expensing) :

• A)$314,380.
• B)$440,000.
• C)$571,510.
• D)$742,930.
• E)None of thesE.The $500,000 §179 expense is reduced to $300,000 because of the property placed in service limitation ($2,200,000 - $2,000,000 threshold) .The half year convention applies.The expense is $571,510 which is depreciation of $1,900,000 × .1429 = $271,510 plus $300,000 of §179 expense.

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Definitions:

Conductors

Materials or objects that allow the flow of electrical current through them.

Magnetic Fields

Invisible fields produced by electrically charged objects affecting the behavior of other charged or magnetic objects in the vicinity.

Electrolyte

A substance, such as the sulfuric acid and water mix used in a battery, that contains free ions that make the substance electrically conductive.

Sulfuric Acid

A highly corrosive strong mineral acid with molecular formula H₂SO₄, used in various applications including battery acid.