1.7k views
4 votes
Which of the following assets has a 5-year recovery period for MACRS depreciation?

A. machinery
B. buildings
C. office furniture and fixtures
D. light general-purpose trucks

User Yrstruly
by
8.5k points

1 Answer

2 votes

Final answer:

Light general-purpose trucks fall under the 5-year property class and thus have a 5-year recovery period for MACRS depreciation. The correct option is D.

Step-by-step explanation:

The asset that has a 5-year recovery period for MACRS (Modified Accelerated Cost Recovery System) depreciation is D. light general-purpose trucks. Under the current MACRS guidelines, different types of assets are categorized into different class lives, which dictate their recovery periods.

Machinery typically falls under a 7-year life, while residential buildings are depreciated over 27.5 years, and nonresidential buildings over 39 years. Office furniture and fixtures generally have a 7-year recovery period.

However, light general-purpose trucks are included in the 5-year property class, which means they have a 5-year recovery schedule for depreciation purposes. The correct option is D.

User Chuck Mosher
by
8.1k points