Answer:
False
Explanation:
MACRS represent Modified Accelerated Cost Recovery System depreciation and it is a depreciation system used in the United States specifically for tax purposes. This method of depreciation allows the recovery of the capitalized cost of fixed assets based on annual deductions over a period of time.
Apart from the depreciable basis, the recovery period and the depreciation method, calculating depreciation based on MACRS also require knowledge of the specific date the asset was placed in service as well as the specific convention that applies to the depreciable asset, for instance, is it a half year or quarter convention?
The convention will help determine the following:
1. The applicable depreciation table based on when the asset was placed in service
2. The amount of depreciation
3. The depreciation method is applicable.
The available depreciation conventions in MACRS include the half-year, mid-quarter and mid-month conventions.
