Problem: Bet'r Bilt Toys just purchased some MACRS 5-year property at a cost of $230,000. Which of the following will correctly give you the book value of this equipment at the end of year 2?
MACRS 5-Year property
Year Rate
1 20.00%
2 32.00%
3 19.20%
4 11.52%
5 11.52%
6 5.76%
(I) 52% of the asset cost
(II) 48% of the asset cost
(III) 68% of 80% of the asset cost
(IV) the asset cost, minus 20% of the asset cost, minus 32% of 80% of the asset cost
1. II only
2. III and IV only
3. I and III only
4. II and IV only
5. I, II, III, and IV