Question

) In April of 2019, Mike acquired a machine for $30,000 to use in his business. It is the only plant asset he purchased this year. The machine is classified as 5-year property. Mike does not expense the property under Sec. 179 or bonus depreciation. Mike's depreciation on the machine for 2019 is
$3,000.

$6,000.

$12,000.

$15,000.

Answer 1

Answer:

Option $6,000

Explanation:

Data provided in the question:

Cost of the machine acquired = $30,000

Classified useful life = 5 years property

Now,

The MARCS rate for 5 years property, the depreciation rate is 20%

Therefore,

The depreciation for the year 2019 will  be

= 20% of the Cost of the machine acquired

= 0.20 × $30,000

= $6,000

Hence,

Option $6,000