1. Shockers Corp. acquires an asset for $200,000 which they estimate 3 years as the service life. For any taxable income, Shockers Corp uses a tax rate of 50%. a)Given double declining balance depreciation method, calculate the deprecation rateand then the depreciation amounts for year 1 through 3. 0 1 2 3 BV(t) D(t) How much tax will this corporation pay and what will be the ATCF for each of the following scenarios for the given year? b) After 3 years the asset is sold for $80,000. c) After 2 years the asset is sold for $300,000. d) After one year the asset is sold for $20,000

1. Shockers Corp. acquires an asset for $200,000 which they estimate 3 years as the service life. For any taxable income, Shockers Corp uses a tax rate of 50%. a)Given double declining balance depreciation method, calculate the deprecation rateand then the depreciation amounts for year 1 through 3. 0 1 2 3 BV(t) D(t) How much tax will this corporation pay and what will be the ATCF for each of the following scenarios for the given year? b) After 3 years the asset is sold for $80,000. c) After 2 years the asset is sold for $300,000. d) After one year the asset is sold for $20,000

SWFT Essntl Tax Individ/Bus Entities 2020

23rd Edition

ISBN:9780357391266

Author:Nellen

Publisher:Nellen

Chapter3: Taxes On The Financial Statements

Section: Chapter Questions

Problem 11P

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