Suppose that a project has a depreciable investment of $600,000 and falls under the following MACRS year 5 class depreciation schedule:
Year 1: 20 percent; year 2: 32 percent; year 3: 19.2 percent; year 4: 11.5 percent; year 5: 11.5 percent; and year 6: 5.8 percent.
Calculate depreciation for year 2.
A)$120,000
B)$192,000
C)$96,000
D)$115,200

Question

Quizplus · Accepted Answer

The depreciation for year 2 is calculated as 32 percent of the depreciable investment of $600,000, which equals $192,000 (0.32 * $600,000).

Suppose That a Project Has a Depreciable Investment of $600,000