Sairra, LLC purchased only one asset during the current year (a full 12-month tax year). Sairra placed in service furniture (7-year property) on April 16 with a basis of $25,000.
Calculate the maximum depreciation expense for the current year? (ignoring §179 and bonus depreciation). (Use MACRS Table 1) (Round final answer to the nearest whole number.)
A) $1,786.
B) $3,573.
C) $4,463.
D) $5,000.
E) None of the choices are correct.

Question

Sairra, LLC purchased only one asset during the current year (a full 12-month tax year). Sairra placed in service furniture (7-year property) on April 16 with a basis of $25,000.
Calculate the maximum depreciation expense for the current year? (ignoring §179 and bonus depreciation). (Use MACRS Table 1) (Round final answer to the nearest whole number.)
A) $1,786.
B) $3,573.
C) $4,463.
D) $5,000.
E) None of the choices are correct.

Quizplus · Accepted Answer

The asset's recovery period is 7 years and the half-year convention applies. The calculation is $25,000 × 0.1429 = $3,573.

Sairra, LLC Purchased Only One Asset During the Current Year