Two years ago, a corporation purchased residential real estate (an apartment complex) at a total cost of $250,000. Of this amount, $50,000 was allocated to the underlying lanD. What is the corporation's allowable depreciation deduction for the current year under MACRS?A)$5,000 B) $5,128 C) $6,350 D) $7,272

correct option is D) $7,272

Explanation:

given data

total cost = $250,000

allocated to underlying lanD = $50,000

solution

we use here MACRS table

so its value is = 27.5

and

now deducted 50000 in 250000 of corporations purchase  that is = 250000 - 50000

so it is

=200000

so now corporation's allowable depreciation deduction is

corporation's allowable depreciation deduction =  

corporation's allowable depreciation deduction = 7272

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