for his home. The computer cost $4,000. H. P uses the computer 60 percent of the

Question

for his home. The computer cost $4,000. H. P uses the computer 60 percent of the On July 15, 2016, H. P: purchases a personal computer time in his business,15 percent of the time for managing his investments and the remaining 25 percent of the time for various personal uses. Calculate i H. P's maximum deprec lation deduction for 2016 for the computer, assuming he does not make the election to expense or take bonus depreciation HTML Editor Paragraph .? 5 pts Question 32 To be depreciated, must an asset actually lose value each year?

Explanation / Answer

Year of Purchase:2016

Cost of asset:$4000

Percentage of time used in business:60%

Amount to be depreciated=0.6*4000=$2,400

It is a MACRS 5 year Property.

Year 1 Recovery Rate for 5 year MACRS property:20%

Amount of depreciation allowed in 2016=2400*0.2=$480

HP’s maximum depreciation deduction in 2016=$480

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