Rex's Wrecks purchased $150,000 in new equipment during the current year. Rex used Section 179 to expense the maximum amount of the purchase. From the following choices, how much did Rex get to expense under Sec. 179, assuming the gross income from his business is $1,200,000 and his expenses (including MACRS depreciation) other than Section 179 were $1,150,000

Question

Business

Israel Todd

15 December, 16:39

Rex's Wrecks purchased $150,000 in new equipment during the current year. Rex used Section 179 to expense the maximum amount of the purchase. From the following choices, how much did Rex get to expense under Sec. 179, assuming the gross income from his business is $1,200,000 and his expenses (including MACRS depreciation) other than Section 179 were $1,150,000

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Answers (1)

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Jennifer Moran · Answer 1

It will depreciate the new equipment for 50,000 dollars

Explanation:

It can depreciate another 50,000 dollar as the 179 S doesn't allow for a depreication that can generate a net loss.

If Rex depreciate the entire 150,000 dollars their net income of 50,000 will swing into a loss of 100,000 That is not allowed. Thus, the aximum amount available for Rex is 50,000