On April 12,2014,Suzanne bought a computer for $20,000 for business use.This was the only purchase for that year.Suzanne used the most accelerated depreciation method available but did not elect Sec.179.Bonus depreciation was not available.Suzanne sells the machine in 2015.The depreciation on the computer for 2015 is
A)$2,000.
B)$3,200.
C)$4,000.
D)$6,400.

Question

Quizplus · Accepted Answer

Suzanne used the most accelerated depreciation method available, which is the MACRS 5-year property method. For the second year (2015), the depreciation rate is 32%, so $20,000 x 32% = $6,400. However, since the computer was sold in 2015, only half-year depreciation applies, making it $3,200.

On April 12,2014,Suzanne Bought a Computer for $20,000 for Business