Question

Which of the following items are needed to calculate MACRS depreciation for an asset?

a-asset's expected usefulness
b-date placed in service
c-asset's condition or age
d-applicable depreciation method
e-asset's original cost
f-applicable recovery period
g-applicable depreciation convention

Answer 1

To calculate MACRS depreciation for an asset, you need the asset's expected usefulness, date placed in service, asset's original cost, applicable recovery period, and applicable depreciation convention.

Step-by-step explanation:

To calculate MACRS depreciation for an asset, you would need the following items:

1. Asset's expected usefulness: This refers to the estimated number of years the asset will be in service.
2. Date placed in service: This is the date the asset is put into use and starts generating income.
3. Asset's original cost: This is the initial purchase price of the asset.
4. Applicable recovery period: This is the number of years over which the asset's cost will be recovered through depreciation.
5. Applicable depreciation convention: There are different conventions for determining depreciation, such as the half-year convention or the mid-month convention.

By considering these factors, you can calculate MACRS depreciation using the appropriate depreciation method, which is based on the asset's recovery period.