Answer:
a. $20,762
b. $47,268
Explanation:
a. 2013
First Building
Date of Purchase = Aug 8, 2013
Using Column 8 as Aug is 8th month of the year and Row 1 as it is first year after purchase from MACRS Table
MACRS rate = 1.364%
Depreciation for Building in 2013 = 1.364% * $800,000 = $10,912
Second Building
Date of Purchase – Jun 15, 2013
Using Column 6 as Jun is 6th month of the year and Row 1 as it is first year after purchase from MACRS Table
MACRS rate = 1.970%
Depreciation for Building in 2013 = 1.970% * $500,000 = $9,850
Total
Total Depreciation for the year 2014 = $10,912 + $9,850 = $20,762
b. 2014
Total cost of Building = $800,000 + $500,000 = 1,300,000
Total Depreciation for the year 2014 = $1,300,000 x 3.636%
Total Depreciation for the year 2014 = $47,268