Question: In 2016 the Moore Company, a tractor manufacturer purchased equipment at a cost of $9, 500,000. The sales tax rate was 6% on the purchase price, the transportation charge was $80,000, and the installation cost was $325,000. The equipment is being depreciate using 7-year MACRS. Sales revenue for 2016 was $80.000.000: cost of goods sold was $35,000,000, manufacturing overhead was $6,000,000; and administrative expense was $20,000,000.
a) Calculate the depreciation expense allowed for year 2016
b) Calculate the taxable income year 2016
c) Calculate the federal income tax due for year 2016