1. Prepare a depreciation schedule showing the depreciation expense, accumulated depreciation, and book value for each year under the Modified Accelerated Cost Recovery System. For tax purposes, assume that the computer has a useful life of five years. (The IRS schedule will spread depreciation over six years.) If required, round your answers to the nearest dollar. If an answer is zero, enter "0".
A computer was purchased on January 1 at a cost of $5,000. It has an estimated useful life of five years and an estimated salvage value of $500 and rates shown below:
| 1 |
$40,000 |
20.00% |
$8,000 |
$8,000 |
$32,000 |
| 2 |
40,000 |
32.00% |
12,800 |
20,800 |
19,200 |
| 3 |
40,000 |
19.20% |
7,680 |
28,480 |
11,520 |
| 4 |
40,000 |
11.52% |
4,608 |
33,088 |
6,912 |
| 5 |
40,000 |
11.52% |
4,608 |
37,696 |
2,304 |
| 6 |
40,000 |
5.76% |
2,304 |
40,000 |
0 |
1. Prepare a depreciation schedule showing the depreciation expense, accumulated depreciation, and book value for each year under the Modified Accelerated Cost Recovery System. For tax purposes, assume that the computer has a useful life of five years. (The IRS schedule will spread depreciation over six years.) If required, round your answers to the nearest dollar. If an answer is zero, enter "0".