Lax LLC Purchased Only One Asset During the Current Year

Multiple Choice

Lax LLC purchased only one asset during the current year (a full 12-month tax year) .On August 26 Lax placed in service computer equipment (five-year property) with a basis of $20,000. Calculate the maximum depreciation expense for the current year (ignoring §179 and bonus depreciation) . (Use MACRS Table 1.)

A) $2,000
B) $2,858
C) $3,000
D) $4,000
E) None of the choices are correct.