Sairra, LLC purchased only one asset during the current year. Sairra placed in service furniture (7-year property) on April 16 with a basis of $25,000. Calculate the maximum depreciation expense for the current year, rounding to a whole number (ignoring §179 and bonus depreciation):
A) $1,786
B) $3,573
C) $4,463
D) $5,000
E) None of these

Question

Quizplus · Accepted Answer

The maximum depreciation expense is calculated using the MACRS 7-year property table. For property placed in service in April, the half-year convention applies. The depreciation rate for the first year is 14.29%. Therefore, $25,000 * 14.29% = $3,573.

Sairra, LLC Purchased Only One Asset During the Current Year