Calculate geraldines net income from her business

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Reference no: EM131916084

1a. Geraldine is an accrual basis taxpayer who has the following transactions during the current calendar tax year:

Calculate Geraldine's net income from her business for the current year.

Accrued business income (except rent)	$472,000
Accrued business expenses (except rent)	$354,000
Rental income on building lease for the next 6 months, received December 1	$47,200
Prepaid Rent Expense for 6 months, paid on December 1	$23,600

1b. Mike purchases a heavy-duty truck (5-year class recovery property) for his delivery service on April 30, 2016. The truck is not considered a passenger automobile for purposes of the listed property and luxury automobile limitations. The truck has a depreciable basis of $39,080 and an estimated useful life of 5 years. Assume half-year convention for tax. Calculate the amount of depreciation for 2016 using:

a. The straight-line depreciation election

b. MACRS tables over the minimum number of years with no bonus depreciation or election to expense.

1c. Give the MACRS depreciation life of the following assets:

An automobile: ______________________

Business furniture: _____________________

A computer: ____________________________

Residential Real Estate: ___________________

Commercial real estate: ____________________

Land: _____________________________

Reference no: EM131916084

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