In 2012, B purchased a crane to be used entirely for business.He spent a total of $475,000.He decided to use the limited-expensing election.What is the total depreciable basis for the mini-computer?

Question

Quizplus · Accepted Answer

The limited-expensing election allows for up to $500,000 of tangible personal property to be expensed in the year it is placed into service. However, since B spent $475,000 on the crane, the total depreciable basis would be the remaining $25,000. Therefore, the correct answer is D) $350,000, which is the depreciation basis after subtracting the expensed amount of $125,000 (the $475,000 cost of the crane minus the $350,000 remaining basis).

In 2012, B Purchased a Crane to Be Used Entirely