1. Which of the following is (are) required to calculate MACRS depreciation? Sel
ID: 2506617 • Letter: 1
Question
1.
Which of the following is (are) required to calculate MACRS depreciation?
Select all that applies.
Annual maintenance costs
Annual benefit
Purchase cost
Salvage value
Property class
Setup and installation cost
Annual maintenance costs
Annual benefit
Purchase cost
Salvage value
Property class
Setup and installation cost
Explanation / Answer
Which of the following is (are) required to calculate MACRS depreciation?
Select all that applies.
Annual maintenance costs
Salvage value
Property class
Setup and installation cost
MACRS stands for modified accelerated cost recovery system. It is the current system allowed in the United States to calculate tax deductions on account of depreciation for depreciable assets (other than intangible assets). IRS Form 4562 is used to claim depreciation deduction.
It allows a larger deduction in early years and lower deductions in later years when compared to the straight-line method.
There are two sub-system of MACRS: the general depreciation system (GDS) and alternate depreciation system (ADS). GDS is the most relevant and is used for most assets.
Annual maintenance costs
Salvage value
Property class
Setup and installation cost
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