*Chapter 9, Problem 041 permanent steel building used for the overhaul of dewate

Question

*Chapter 9, Problem 041 permanent steel building used for the overhaul of dewatering systems (engines, pumps, and welpoints) is placed in service on July 10 by a calendar-year taxpayer for $360,000. It is sold almost 5 years later on May 15. Click here to access the MACRS-GDS Property Classes What is the MACRS-GDS property class? Determine the depreciation deduction during each of the years involved EOY Depreciation Deduction Carry all interim calculations to 5 decimal places and then round your final answer to the nearest dollar. The tolerance is ±3%. Determine the unrecovered investment during each of the years involved. EOY Unrecovered Investment

Explanation / Answer

Assumption

Depreciation method is streight line method

useful life is 6 years

and their is no salvage value

Year Depreciation unrecovered
investment 0 0 $ 3,60,000.00 1 $ 60,000.00 $ 3,00,000.00 2 $ 60,000.00 $ 2,40,000.00 3 $ 60,000.00 $ 1,80,000.00 4 $ 60,000.00 $ 1,20,000.00 5 $ 60,000.00 $     60,000.00 6 $ 60,000.00 $                    -  

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