On August 3,2017,Yang purchases office furniture (7-year property)costing $21,000 for use in her business.She does not wish to use the Section 179 election and makes the election to use the straight-line method over the MACRS recovery period.What is Yang's 2017 cost recovery deduction?

Question

Quizplus · Accepted Answer

Under MACRS, 7-year property using the straight-line method has a half-year convention in the first year. The cost recovery deduction is calculated as $21,000 / 7 years * 0.5 (half-year convention) = $1,500.

On August 3,2017,Yang Purchases Office Furniture (7-Year Property)costing $21,000 for Use