Barbara's Bakery purchased three new 7-year assets last year. She chose NOT to use Section 179 immediate expensing or take bonus
depreciation. The furnishings were purchased for $15,000 in April, the equipment for $6,000 in July, and the appliances for $40,000 in November. Using the appropriate MACRS depreciation tables in the Appendix, what amount of depreciation expense is allowable in the current (second) year of ownership? a) $16,806
b) $14,939
c) $16,163
d) $16,072
Generally we have use half year convention for assets that are purchased during the year but here we used the mid quarter as of more than the 40% of the assets are being purchased in last quarter of the year
(it is more than 40%)
Thus we can use the mid quarter mars depreciation rates for the 7 years assets that are purchased this year.