Sairra LLC purchased only one asset during the current year (a full 12-month tax year). On April 16 Sairra placed in service furniture (seven-year property) with a basis of $25,000. Calculate the maximum depreciation expense for the current year (ignoring §179 and bonus depreciation). (Use MACRS Table 1.) (Round final answer to the nearest whole number.)
A. $1,786.
B. $5,000.
C. $4,463.
D. $3,573.
E. None of the choices are correct.
Answer: D
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Closing entries will
a. decrease the Retained Earnings balance. b. most likely either increase or decrease the Retained Earnings balance. c. not affect the Retained Earnings balance. d. increase the Retained Earnings balance.
The voucher system of control:
A. Is a set of procedures and approvals designed to control cash receipts and the acceptance of liabilities. B. Establishes procedures for verifying, approving, and recording liabilities for eventual cash payment. C. Applies only when multiple purchases are made from the same supplier. D. Establishes procedures for receiving checks for the sale of verified, approved, and recorded activities. E. Is required in large companies but not beneficial for small to mid-sized companies.
The term "active participation" is used to determine:
A. Whether a taxpayer is eligible for the $25,000 rental offset. B. Whether a taxpayer is a material participant. C. Whether an activity is considered passive. D. None of these.
Briefly describe the constitutional doctrine of separation of powers, noting particularly the uniqueness of such a doctrine