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Question
Dain's Diamond Bit Drilling purchased the following assets this year. Asset Purchase Date Original Basis Drill bits (5- January $ 90,000 year) 25 Drill bits (5- July 25 95,000 year) Commercial building 220,000 April 22 Assume its taxable income for the year was $53,000 before deducting any $179 expense (assume no bonus depreciation but assume that the 2014 $179 limits are extended to 2015). (Use MACRS Table 1, Table 2, Table 3, Table 4 and Table 5.) (Do not round intermediate calculations. Round your final answers to the nearest whole dollar amount.) a. What is Dain's maximum §179 expense for the year? b. What is Dain's maximum depreciation expense for the year (including §179 expense)? C. If the January drill bits' original basis was $2,375,000, what is Dain's maximum §179 expense for the year? d. If the January drill bits' basis was $2,495,000, what is Dain's maximum §179 expense for the year?(Leave no answer blank. Enter zero if applicable.)
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Transcribed Image Text:Dain's Diamond Bit Drilling purchased the following assets this year. Asset Purchase Date Original Basis Drill bits (5- January $ 90,000 year) 25 Drill bits (5- July 25 95,000 year) Commercial building 220,000 April 22 Assume its taxable income for the year was $53,000 before deducting any $179 expense (assume no bonus depreciation but assume that the 2014 $179 limits are extended to 2015). (Use MACRS Table 1, Table 2, Table 3, Table 4 and Table 5.) (Do not round intermediate calculations. Round your final answers to the nearest whole dollar amount.) a. What is Dain's maximum §179 expense for the year? b. What is Dain's maximum depreciation expense for the year (including §179 expense)? C. If the January drill bits' original basis was $2,375,000, what is Dain's maximum §179 expense for the year? d. If the January drill bits' basis was $2,495,000, what is Dain's maximum §179 expense for the year?(Leave no answer blank. Enter zero if applicable.)
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