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[The following information applies to the questions displayed below.] Dains Diamond Bit Drilling...

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Accounting

[The following information applies to the questions displayed below.]

Dains Diamond Bit Drilling purchased the following assets this year.

Purchase Original
Asset Date Basis
Drill bits (5-year) Jan-08 $ 90,500
Drill bits (5-year) Jul-15 98,500
Commercial building Apr-13 286,000

Assume its taxable income for the year was $64,250 for purposes of computing the 179 expense (assume no bonus depreciation). (Use MACRS Table 1, Table 2, Table 3, Table 4 and Table 5.) (Leave no answer blank. Enter zero if applicable.)

c. If the January drill bits original basis was $2,596,000, what is the maximum amount of 179 expense Dain's may deduct for the year?

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