Example Problem 3: Re-work Example 1 using SYD METHOD ΕΟΥ, k Number of SYD dk BVk dk* Depreciation Factor year in reverse order (digits 1 10 0.1818 727.27 9. 0.1636 654.55 3 0.1455 581.82 4 7 0.1273 509.09 1527.27 2472.73 5 0.1091 436.36 6. 0.0909 363.64 7 0.0727 290.91 8 0.0545 218.18 9 0.0364 145.45 10 1 0.0182 72.73 Sum of 55 Digits o5432-3

QUESTION 9 Amotor vehicle which cost £30,000 is depreciated at 20% per annum using the reducing balance method. The depreciation charge for the second year would be: a. £13,800 b.E8,000 c. £4,800 24,000x20%=£4,800 d.£7,200

Sairra LLC purchased only one asset during the current year (a full 12-month tax year). On April 16 Sairra placed in service furniture (seven-year property) with a basis of $38,000. 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.) Multiple Choice $2,715 $5,430 $6,320 $7,600 None of the choices are correct.

Table 1  Depreciation Rate for Recovery Period   3-Year 5-Year 7-Year 10-Year 15-Year 20-Year Year 1   33.33%   20.00%   14.29%   10.00%   5.00%   3.750% Year 2  44.45 32.00 24.49 18.00 9.50 7.219 Year 3  14.81 19.20 17.49 14.40 8.55 6.677 Year 4    7.41 11.52 12.49 11.52 7.70 6.177 Year 5   11.52   8.93   9.22 6.93 5.713 Year 6     5.76   8.92   7.37 6.23 5.285 Year 7       8.93   6.55 5.90 4.888 Year 8       4.46   6.55 5.90 4.522 Year 9         6.56 5.91 4.462 Year 10         6.55 5.90 4.461 Year 11         3.28 5.91 4.462 Year 12         5.90 4.461 Year 13         5.91 4.462 Year 14         5.90 4.461 Year 15         5.91 4.462 Year 16         2.95 4.461 Year 17           4.462 Year 18           4.461 Year 19           4.462 Year 20           4.461 Year 21           2.231   Table 3  Month Property Placed in Service   Month 1 Month 2 Month 3 Month 4 Month 5 Month 6 Month 7 Month 8 Month 9 Month 10 Month 11 Month 12 Year 1…