Question: Prepare a spreadsheet to calculate the depreciation for residential (27.5-year recovery period) and commercial (39-year recovery period) real estate using the straight-line depreciation method. The spreadsheet should allow the user to select the month that the real estate is placed in service, with January being the first month. Use the percentages in Table 5-5 to determine the first year's depreciation. Test your spreadsheet by entering. Compare your spreadsheet's solution to the answer to these problems. Hint: Use the IF function to discontinue the depreciation and book value at the end of the recovery period and the VLOOKUP function to select the data from Table. (See Appendix B for more information on the VLOOKUP function.)
