On June 1, 2019, Irene places in service a new automobile that cost $21,000. The car is used 70% for business and 30% for person

Question

3 years ago

14

On June 1, 2019, Irene places in service a new automobile that cost $21,000. The car is used 70% for business and 30% for person

al use. (Assume this percentage is maintained for the life of the car.) She does not take additional first-year depreciation. Determine the cost recovery deduction for 2020. a.$4,704 b.$3,570 c.$10,100 d.$3,290

Business

1 answer:

worty [1.4K] · Answer 1 · 2022-05-30T07:55:45+03:00

worty [1.4K]3 years ago

4 0

Answer:

a.$4,704

Explanation:

Depreciation rate applicable for 2nd year as per MACRS 5 year class property = 32%

So, Irene cost recovery deduction = $21,000 * 32% * 70% = $4,704

Hence, the cost recovery deduction for Irene in 2020 is $4,704.