An engineering and construction management firm with a $1M taxable income is opening a branch office. Nearly $250,000 worth of furniture will be depreciated under MACRS.
(a) What are the ATCFs for the furniture for the first 5 years?
(b) If the office is closed early in year 6 and the furniture is sold to a secondhand office furniture store for 10% of its initial cost, what tax is paid?
(Answer: -$10,463.5)