On August 3,2016,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 2016 cost recovery deduction?

Question

Quizplus · Accepted Answer

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

On August 3,2016,Yang Purchases Office Furniture (7-Year Property)costing $21,000 for Use