Table 1: Sanjuro Corporation (a calendar-year corporation)purchased and placed in service the following assets during 2013:
All assets are used 100% for business use.The warehouse building does not include the cost of the land on which it is located which was an additional $1,000,000.The corporation has $3,000,000 income from operations before calculating depreciation deductions.Sanjuro Corporation wishes to maximize its overall depreciation deduction for 2013 and is willing to make any necessary elections.
-Refer to the information in Table 1.What is Sanjuro Corporation's maximum cost recovery deduction for the warehouse in 2013?

Question

Table 1: Sanjuro Corporation (a calendar-year corporation)purchased and placed in service the following assets during 2013:
  All assets are used 100% for business use.The warehouse building does not include the cost of the land on which it is located which was an additional $1,000,000.The corporation has $3,000,000 income from operations before calculating depreciation deductions.Sanjuro Corporation wishes to maximize its overall depreciation deduction for 2013 and is willing to make any necessary elections.
-Refer to the information in Table 1.What is Sanjuro Corporation's maximum cost recovery deduction for the warehouse in 2013?

Quizplus · Accepted Answer

The maximum cost recovery deduction for the warehouse in 2013 is $55,052. This is because the warehouse is a 39-year property, and the maximum deduction for the first year is $55,052.

Table 1: Sanjuro Corporation (A Calendar-Year Corporation)purchased and Placed in Service