Exam 7: Accounting Periods and Methods and Depreciation

Max purchases a new auto in 2017 at a cost of $56,000.He uses the car 80% for business.Assuming a half-year convention,bonus depreciation but no immediate expensing,what is the depreciation deduction on the auto?

(Multiple Choice)

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Question 81

If a loss from sale or exchange of property between related parties is disallowed and the property is subsequently sold to an unrelated party,

(Multiple Choice)

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Question 82

On August 1,2017,David purchased manufacturing equipment for use in his business.The equipment cost $14,000 and has an estimated useful life and MACRS class life of 7 years. a. Calculate the amount of depreciation on the manufacturing equipment for 2017 using the accelerated MACRS method and no election to expense or use bonus depreciation is made. b. Calculate the amount of depreciation on the manufacturing equipment for 2017 using the accelerated MACRS method and bonus depreciation used but no election to expense. c.Calculate the amount of depreciation on the manufacturing equipment for 2017 using the straight-line MACRS optional method and no election to expense or use bonus depreciation is made. d. Calculate the amount of depreciation on the manufacturing equipment for 2017 for financial accounting purposes using the straight-line method of depreciation.

(Essay)

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Question 83

What is the maximum depreciation expense deduction for Year 2 (2018)for a passenger automobile,used 100 percent for qualified business use,placed in service on June 15,2017 and costing $16,000 (the election to expense is not made and no bonus depreciation was taken)?

(Multiple Choice)

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Question 84

Which one of the following may not be depreciated using an accelerated method?

(Multiple Choice)

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Question 85

Vernon is a cash basis taxpayer with a calendar tax year.On October 1,2017,Vernon entered into a lease to rent a building for use in his business at $3,000 a month.On that day Vernon paid 18 months rent on the building,a total of $54,000 ($3,000 × 18 months).How much may Vernon deduct for rent expense on his 2017 tax return?

(Multiple Choice)

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Question 86

Kate is an accrual basis,calendar-year taxpayer.On November 1,2017,Kate leased out a building for $4,500 a month.On that day Kate received 7 months rental income on the building,a total of $31,500 ($4,500 × 7 months).How much income must Kate include on her 2017 tax return as a result of this transaction?

(Multiple Choice)

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Question 87

Joyce purchased a passenger automobile on March 2,2017.She paid $12,000 for the automobile and can support business use of 85 percent.Calculate the amount of depreciation on the automobile for 2017 using the accelerated MACRS method (if available),assuming Joyce does not make the election to expense or claim bonus depreciation.

(Essay)

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Question 88

William,a cash-basis sole proprietor,had the following receipts and disbursements for the current year: For the current year,what amount should William report as net earnings from self-employment?

(Multiple Choice)

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Question 89

Depreciation on property in the five-year MACRS class is claimed over a period of six tax years due to the half-year convention.

(True/False)

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Question 90

ABC Corp bought a production machine on January 1,2015 for $31,250.The company did not elect Section 179 expensing and elected out of claiming bonus depreciation in 2015,and is depreciating the machine using the MACRS accelerated depreciation tables for 5-year property.What is the 2017 depreciation (year 3)deduction for the machine?

(Multiple Choice)

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Question 91

Depreciation is the process of allocating the cost of assets to expense over a period of years.

(True/False)

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Question 92

In 2017,a taxpayer purchases a new automobile (5 year recovery)for $56,000 for 100% use in her business.What is the total cost recovery assuming that the taxpayer does or does not elect bonus depreciation on the auto (half-year convention but no immediate expensing)?

(Multiple Choice)

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Question 93

Choose the correct answer.In calculating depreciation:

(Multiple Choice)

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Question 94

On October 21,2017,Jay purchased a commercial building.The cost basis assigned to the building is $700,000.Jay also owns a residential apartment building he purchased on June 15,2016 with a cost basis of $500,000. a.Calculate Jay's total depreciation deduction for the buildings for 2017,using MACRS. b.Calculate Jay's total depreciation deduction for the commercial building for 2018,using MACRS.

(Essay)

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Question 95

An asset (not an automobile)put in service in June 2017 has a depreciable basis of $535,000 and a recovery period of 5 years.Assuming bonus depreciation is used,a half-year convention,and no expensing election,what is the maximum amount of cost that can be deducted in 2017?

(Multiple Choice)

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Question 96

Sales of property at a gain may be restricted under the related party rules of the Internal Revenue Code.

(True/False)

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Question 97

If listed property is used more than 50 percent in a qualified business use,depreciation must be calculated using the straight-line method.

(True/False)

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Question 98

Which of the following is true with respect to the related party rules?

(Multiple Choice)

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Question 99

Depreciation refers to the physical deterioration or loss of value of an asset.

(True/False)

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Question 100

Showing 81 - 100 of 111

Max purchases a new auto in 2017 at a cost of $56,000.He uses the car 80% for business.Assuming a half-year convention,bonus depreciation but no immediate expensing,what is the depreciation deduction on the auto?

If a loss from sale or exchange of property between related parties is disallowed and the property is subsequently sold to an unrelated party,

What is the maximum depreciation expense deduction for Year 2 (2018)for a passenger automobile,used 100 percent for qualified business use,placed in service on June 15,2017 and costing $16,000 (the election to expense is not made and no bonus depreciation was taken)?

Which one of the following may not be depreciated using an accelerated method?

William,a cash-basis sole proprietor,had the following receipts and disbursements for the current year: For the current year,what amount should William report as net earnings from self-employment?

Depreciation on property in the five-year MACRS class is claimed over a period of six tax years due to the half-year convention.

Depreciation is the process of allocating the cost of assets to expense over a period of years.

In 2017,a taxpayer purchases a new automobile (5 year recovery)for $56,000 for 100% use in her business.What is the total cost recovery assuming that the taxpayer does or does not elect bonus depreciation on the auto (half-year convention but no immediate expensing)?

Choose the correct answer.In calculating depreciation:

An asset (not an automobile)put in service in June 2017 has a depreciable basis of $535,000 and a recovery period of 5 years.Assuming bonus depreciation is used,a half-year convention,and no expensing election,what is the maximum amount of cost that can be deducted in 2017?

Sales of property at a gain may be restricted under the related party rules of the Internal Revenue Code.

If listed property is used more than 50 percent in a qualified business use,depreciation must be calculated using the straight-line method.

Which of the following is true with respect to the related party rules?

Depreciation refers to the physical deterioration or loss of value of an asset.

The Individual Income Tax Return

Gross Income and Exclusions

Business Income and Expenses Part I

Business Income and Expenses Part II

Itemized Deductions and Other Incentives

Credits and Special Taxes

Capital Gains and Losses

Withholding Estimated Payments and Payroll Taxes

Partnership Taxation

The Corporate Income Tax

Tax Administration and Tax Planning

Filters

Exam 7: Accounting Periods and Methods and Depreciation

Max purchases a new auto in 2017 at a cost of $56,000.He uses the car 80% for business.Assuming a half-year convention,bonus depreciation but no immediate expensing,what is the depreciation deduction on the auto?

If a loss from sale or exchange of property between related parties is disallowed and the property is subsequently sold to an unrelated party,

What is the maximum depreciation expense deduction for Year 2 (2018)for a passenger automobile,used 100 percent for qualified business use,placed in service on June 15,2017 and costing $16,000 (the election to expense is not made and no bonus depreciation was taken)?

Which one of the following may not be depreciated using an accelerated method?

William,a cash-basis sole proprietor,had the following receipts and disbursements for the current year: ​ For the current year,what amount should William report as net earnings from self-employment?

Depreciation on property in the five-year MACRS class is claimed over a period of six tax years due to the half-year convention.

Depreciation is the process of allocating the cost of assets to expense over a period of years.

In 2017,a taxpayer purchases a new automobile (5 year recovery)for $56,000 for 100% use in her business.What is the total cost recovery assuming that the taxpayer does or does not elect bonus depreciation on the auto (half-year convention but no immediate expensing)?

Choose the correct answer.In calculating depreciation:

An asset (not an automobile)put in service in June 2017 has a depreciable basis of $535,000 and a recovery period of 5 years.Assuming bonus depreciation is used,a half-year convention,and no expensing election,what is the maximum amount of cost that can be deducted in 2017?

Sales of property at a gain may be restricted under the related party rules of the Internal Revenue Code.

If listed property is used more than 50 percent in a qualified business use,depreciation must be calculated using the straight-line method.

Which of the following is true with respect to the related party rules?

Depreciation refers to the physical deterioration or loss of value of an asset.

The Individual Income Tax Return

Gross Income and Exclusions

Business Income and Expenses Part I

Business Income and Expenses Part II

Itemized Deductions and Other Incentives

Credits and Special Taxes

Capital Gains and Losses

Withholding Estimated Payments and Payroll Taxes

Partnership Taxation

The Corporate Income Tax

Tax Administration and Tax Planning

Filters

William,a cash-basis sole proprietor,had the following receipts and disbursements for the current year: For the current year,what amount should William report as net earnings from self-employment?