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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