Barbara's Bakery purchased three new assets during the prior year. She chose NOT to use Section 179 to immediately expense the assets and she elected NOT to use bonus depreciation. She purchased furnishings for $15,000 in April, equipment for $6,000 in July, and appliances for $40,000 in November. Using the MACRS tables with a 7-year recovery period, what is the amount of depreciation that can be taken on these assets in the current (second) year?

Section 179 to immediately expense the assets and she elected NOT to use bonus depreciation. She purchased furnishings for $15,000 in April, equipment for $6,000 in July, and appliances for $40,000 in November. Using the MACRS tables with a 7-year recovery period, what is the amount of depreciation that can be taken on these assets in the current (second) year?16,072Barbara’s Bakery purchased furnishings (7 year property) 4 years ago. During the current year, she sold the furnishings. Her original cost in these assets was $15,000 and she did NOT use bonus depreciation or Section 179 expensing in the year she purchased them. Due to other asset purchases that year, she has been using the mid-quarter convention when calculating the depreciation, and the furnishings were purchased in the second quarter of that year. If Barbara sold the furnishings in October of the current year (recovery period 4), how much depreciation will she be able to deduct this year?1,571 (15,000 x .1197) x .875 = 1,571T or F: Personal property can be business property or personal-use property. True (personal property is simple tangible property, other than real property. It may be used in a trade or business or it may be used personally.)The ____ - _____ convention allows 50% of a full year’s depreciation in the year the asset is placed in service, regardless of when it was actually placed in service. Half-yearTom purchased a 7-year asset for his business in February, three years ago for $4,500 and used the half-year convention for MACRS. He did not deduct any bonus depreciation and he did not elect Sec. 179 expensing in the year of purchase. He sold the asset in April, 2017. How much depreciation will Tom deduct in the current year (year 4)?281The mid-quarter test is applied _____ (before/after) the Section 179 expense is deducted from an asset’s basis, and ____ (before/after) bonus depreciation is taken. AfterBeforeBarbara’s Bakery purchased three new assets during the prior year. She chose NOT to use Section 179 to immediately expense the assets and she elected NOT to use bonus depreciation. She purchased furnishings for $15,000 in April, equipment for $6,000 in July, and appliances for $40,000 in November. Using the MACRS tables with a 7-year recovery period, what is the amount of depreciation that can be taken on these assets in the first year?4,748 (the mid-quarter convention applies since more than 40 percent of the personal property was purchased in the fourth quarter)Barbara’s Bakery purchased appliances (7 year property) in Year 1. In Year 4, she sold the appliances purchased in Year 1. Her original cost in the appliances was $40,000 and she did NOTuse bonus depreciation or Section 179 expensing in the year of purchase. She used the mid-

quarter convention when calculating the depreciation because the assets were purchased in the fourth quarter of Year 1. If Barbara sold the furnishings in March of Year 4, she will be able to deduct $____ of depreciation that year. (Use the MACRS tables at the end of the chapter to assistwith this problem.)703 (.1406 x 40,000 x 0.5/4 = 703 (0.5 is for ½ of the first quarter.