On May 30,2015,Jane purchased a factory building to use for her business.In August 2016,Jane paid $300,000 for improvements to the building.Determine Jane's total deduction with respect to the building improvements for 2016.
A)$2,889
B)$4,173
C)$4,815
D)$25,000
E)None of the above

Question

Quizplus · Accepted Answer

The correct answer is A because the total deduction for building improvements is $2,889. This is calculated by taking the cost of the improvements ($300,000) and multiplying it by the applicable depreciation rate (3.636%).

On May 30,2015,Jane Purchased a Factory Building to Use for Her