Carlos purchased an apartment building on November 16,2013,for $3,000,000.Determine the cost recovery for 2013.
A)$9,630.
B)$11,910.
C)$13,950.
D)$22,740.
E)None of the above.

Question

Quizplus · Accepted Answer

Cost recovery, also known as depreciation, only begins in the year that the property is placed in service for its intended use. Since Carlos purchased the apartment building on November 16, 2013, it is unlikely that it was placed in service for its intended use before the end of the year. Therefore, there is no cost recovery for 2013.

Carlos Purchased an Apartment Building on November 16,2013,for $3,000,000