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Karane Enterprises, a calendar-year manufacturer based in College Station, Texas, began business in 2022. In the process of setting up the business, Karane has acquired various types of assets. Below is a list of assets acquired during 2022: Date Asset Cost Placed in Service Office furnitures 150,000 02/03/2022 Machinery Used delivery 1,560,000 07/22/2022 40,000 08/17/2022 truck* "Not considered a luxury automobile. During 2022, Karane was very successful (and had no §179 limitations) and decided to acquire more assets In 2023 to Increase its production capacity. These are the assets acquired during 2023: Asset Computers and information system Luxury auto* Assembly equipment Storage building Cost Date Placed in Service $ 400,000 03/31/2023 80,000 05/26/2023 1,200,000 08/15/2023 "Used 100% for business purposes. 700,000 11/13/2023 Karane generated taxable income in 2023 of $1,732,500 for purposes of computing the $179 expense limitation. (Use MACRS Table 1, Table 2. Table 3, Table 4, Table 5, and Exhibit 10-10.) Note: Leave no answer blank. Enter zero if applicable. Input all the values as positive numbers. Required: . Compute the maximum 2023 depreciation deductions, including $179 expense (ignoring bonus depreciation). Answer is not complete. Section Description Cost 179 Expense MACRS Basis Current MACRS Total Cost Recovery Depreciation Deduction 2022 Assets Office furniture $ 150,000 $ C$ 150,000 $ 36,735 S 36,735 Machinery Used delivery truck 1,560,000 40,000 0 40,000 12,800 12,800 2023 Assets Computers and 400,000 400,000 80,000 80,000 Information System Luxury Auto 80,000 80,000 0 Assembly Equipment 1,200,000 0 Storage Building 700,000 ✓ 700,000 $ Total 0 $ 2,247 131,782 2.247 $ 131,782 4,130,000 1,370,000

Karane Enterprises, a calendar-year manufacturer based in College Station, Texas, began business in 2022. In the process of setting up the business, Karane has acquired various types of assets. Below is a list of assets acquired during 2022: Date Asset Cost Placed in Service Office furnitures 150,000 02/03/2022 Machinery Used delivery 1,560,000 07/22/2022 40,000 08/17/2022 truck* "Not considered a luxury automobile. During 2022, Karane was very successful (and had no §179 limitations) and decided to acquire more assets In 2023 to Increase its production capacity. These are the assets acquired during 2023: Asset Computers and information system Luxury auto* Assembly equipment Storage building Cost Date Placed in Service $ 400,000 03/31/2023 80,000 05/26/2023 1,200,000 08/15/2023 "Used 100% for business purposes. 700,000 11/13/2023 Karane generated taxable income in 2023 of $1,732,500 for purposes of computing the $179 expense limitation. (Use MACRS Table 1, Table 2. Table 3, Table 4, Table 5, and Exhibit 10-10.) Note: Leave no answer blank. Enter zero if applicable. Input all the values as positive numbers. Required: . Compute the maximum 2023 depreciation deductions, including $179 expense (ignoring bonus depreciation). Answer is not complete. Section Description Cost 179 Expense MACRS Basis Current MACRS Total Cost Recovery Depreciation Deduction 2022 Assets Office furniture $ 150,000 $ C$ 150,000 $ 36,735 S 36,735 Machinery Used delivery truck 1,560,000 40,000 0 40,000 12,800 12,800 2023 Assets Computers and 400,000 400,000 80,000 80,000 Information System Luxury Auto 80,000 80,000 0 Assembly Equipment 1,200,000 0 Storage Building 700,000 ✓ 700,000 $ Total 0 $ 2,247 131,782 2.247 $ 131,782 4,130,000 1,370,000

Intermediate Accounting: Reporting And Analysis
Intermediate Accounting: Reporting And Analysis
3rd Edition
ISBN:9781337788281
Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach
Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach
Chapter12: Intangibles
Section: Chapter Questions
Problem 13E
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Karane Enterprises, a calendar-year manufacturer based in College Station, Texas, began business in 2022. In the process of setting up the business, Karane has acquired various types of assets. Below is a list of assets acquired during 2022: Date Asset Cost Placed in Service Office furnitures 150,000 02/03/2022 Machinery 1,560,000 07/22/2022 Used delivery truck* 40,000 08/17/2022 "Not considered a luxury automobile. During 2022, Karane was very successful (and had no §179 limitations) and decided to acquire more assets In 2023 to Increase its production capacity. These are the assets acquired during 2023: Asset Computers and information system Luxury auto✶ Assembly equipment Storage building Cost Date Placed in Service $ 400,000 03/31/2023 80,000 05/26/2023 1,200,000 08/15/2023 "Used 100% for business purposes. 700,000 11/13/2023 Karane generated taxable income in 2023 of $1,732,500 for purposes of computing the $179 expense limitation. (Use MACRS Table 1, Table 2. Table 3, Table 4, Table 5, and Exhibit 10-10.) Note: Leave no answer blank. Enter zero if applicable. Input all the values as positive numbers. Required: . Compute the maximum 2023 depreciation deductions, including $179 expense (ignoring bonus depreciation). Answer is not complete. Section Description Cost 179 Expense MACRS Basis Current MACRS Depreciation Total Cost Recovery Deduction 2022 Assets Office furniture $ 150,000 $ C$ 150,000 $ 36,735 S 36,735 Machinery Used delivery truck 1,560,000 40,000 0 40,000 12,800 12,800 2023 Assets Computers and 400,000 400,000 80,000 80,000 Information System Luxury Auto 80,000 80,000 0 Assembly Equipment 1,200,000 0 Storage Building 700,000 700,000 2,247 2.247 $ Total 0 $ 131,782 $ 131,782 4,130,000 1,370,000
Transcribed Image Text:Karane Enterprises, a calendar-year manufacturer based in College Station, Texas, began business in 2022. In the process of setting up the business, Karane has acquired various types of assets. Below is a list of assets acquired during 2022: Date Asset Cost Placed in Service Office furnitures 150,000 02/03/2022 Machinery 1,560,000 07/22/2022 Used delivery truck* 40,000 08/17/2022 "Not considered a luxury automobile. During 2022, Karane was very successful (and had no §179 limitations) and decided to acquire more assets In 2023 to Increase its production capacity. These are the assets acquired during 2023: Asset Computers and information system Luxury auto✶ Assembly equipment Storage building Cost Date Placed in Service $ 400,000 03/31/2023 80,000 05/26/2023 1,200,000 08/15/2023 "Used 100% for business purposes. 700,000 11/13/2023 Karane generated taxable income in 2023 of $1,732,500 for purposes of computing the $179 expense limitation. (Use MACRS Table 1, Table 2. Table 3, Table 4, Table 5, and Exhibit 10-10.) Note: Leave no answer blank. Enter zero if applicable. Input all the values as positive numbers. Required: . Compute the maximum 2023 depreciation deductions, including $179 expense (ignoring bonus depreciation). Answer is not complete. Section Description Cost 179 Expense MACRS Basis Current MACRS Depreciation Total Cost Recovery Deduction 2022 Assets Office furniture $ 150,000 $ C$ 150,000 $ 36,735 S 36,735 Machinery Used delivery truck 1,560,000 40,000 0 40,000 12,800 12,800 2023 Assets Computers and 400,000 400,000 80,000 80,000 Information System Luxury Auto 80,000 80,000 0 Assembly Equipment 1,200,000 0 Storage Building 700,000 700,000 2,247 2.247 $ Total 0 $ 131,782 $ 131,782 4,130,000 1,370,000
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