Overland purchased $387,950 of fixed assets that are classified as three-year property for MACRS. The MACRS rates are. 3333,.4445,.1481, and. 0741 for Years 1 to 4, respectively. What is the amount of the depreciation expense in Year 3 assuming no bonus depreciation is taken?

Answer: $57,455.395

Explanation:

Given that,

Fixed assets purchased = $387,950

MACRS rates are as follows:

Year 1 = 0.3333

Year 2 = 0.4445

Year 3 = 0.1481

Year 4 = 0.0741

Depreciation Expense in Year 3:

= Initial Value or Purchase Price of equipment * MACRS rate for Year 3

= $387,950 * 0.1481

= $57,455.395