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Bolton Corporation uses the calendar year as its tax year. It purchases and places into...

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Question

Accounting

Bolton Corporation uses the calendar year as its tax year. It purchases and places into service $1.5 million of property during 2018 to use in its business:

a. What is Bolton's total depreciation deduction for 2018 if Bolton elects out of bonus depreciation and does not claim Sec. 179 expensing? (Use MACRS rates to three decimal places, X.XXX%. Round the MACRS depreciation to the nearest dollar.)

b. Bolton claims Sec. 179 expensing for $630,000 of the office furniture's cost and $370,000 fo the office machinery's cost.

c. Bolton claims Sec. 179 expensing for $610,000 of the office furniture's cost and $390,000 of the office machinery's cost.

Placed into service

Cost

Recovery Period

Apartment building*

May 1

$480,000

27.5 years

Office furniture

June 23

$630,000

7 years

Office machinery

October 15

$390,000

5 years

* $100,000 of the cost pertains to the land on which the apartment building is located

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