On October 1, 2019, Priscilla purchased a business. Of the purchase price, $60,000 is allocated to a patent and $375,000 is allocated to goodwill. Calculate Priscilla’s 2019 § 197 amortization deduction.

Euclid acquires a 7 year class asset on May 9,2021 for $80,000(only asset acquired during the year). Euclid does not elect immediate expense under 179. She does not claim any available additional 1st year dep. Calculate cost recovery deduction for 2021 and 2022.

Andre acquired a computer on March 3, 2019, for $2,800. He elects the straight-line method for cost recovery. Andre does not elect immediate expensing under § 179. He does not claim any available additional first-year depreciation. Click here to access the depreciation table to use for this problem. Calculate Andre's cost recovery deduction for the computer for tax years 2019 and 2020. 2019: $ 2020: $

Diana acquires, for $65,000 ad places in service a 5 year class asset on December 19,2020. It is the only asset that Diana acquires during 2020. Diana does not elect immediate expensing under section 179. She elects additional first-year depreciation. Calculate Diana’s total recovery deduction for 2020.

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Fareed sells a piece of equipment used in a business for $31,500 during 2021. The equipment was purchased on July 1, 2019, at a cost of $22,000. Fareed has taken $6,600 of depreciation on the equipment. What are the amount and classification of the gain on the sale by Fareed? Group of answer choices $9,500 Section 1231 gain. $16,100 ordinary income under Section 1245. $16,100 Section 1231 gain. $6,600 ordinary income under Section 1245 and $9,500 Section 1231 gain.

Potomac LLC purchased an automobile for $65,000 on August 5, 2019. What is Potomac's depreciation expense for 2019 (recognizing that Potomac does not elect any bonus depreciation)? Exhibit 10-10  on page 10-26.  The text does not reflect year 2020 limits, so this problem will use Year 2019 limits, to avoid confusion.

Sandra acquires a new machine (7-year property) for her business on March 10, 2020, at a cost of $430,000. Sandra makes the election to expense the maximum amount under §179, and wants to take any additional first-year depreciation allowed. No election is made to use the straight-line method. Determine the total deductions in calculating taxable income related to the machine for 2020 assuming Sandra has taxable income of $500,000.

On January 1, 2019, Ted purchased a small software company for $200,000. He paid $120,000 for the fixed assets of the company and $80,000 for goodwill. How much amortization may Ted deduct on his 2019 tax return for the purchased goodwill?

Diana acquires, for $65,000, and places in service a 5-year class asset on December 19, 2020. It is the only asset that Diana acquires during 2020. Diana does not elect immediate expensing under § 179. She elects additional first-year deprecation.