You are looking at a farm’s balance sheets from December 31,…

You are looking at a farm’s balance sheets from December 31, 2023.  Equity on a cost basis was $1,275,923. When looking the total equity on the market basis balance sheet it was 1,303,571. The farmer asks why there are two different numbers for her equity.  Clearly explain why these two numbers are different.

You purchased a used combine for $320,000.  The combine is a…

You purchased a used combine for $320,000.  The combine is a 5-year tax class asset.  Using information in the table below, calculate the amount of tax depreciation for the 4th year of ownership Year Tax Depreciation Rate Tax Basis (end of year) 1 20.00% $256,000 2 32.00% $153,600 3 19.20% $92,160 4 11.52% $55,296 5 11.52% $18,432 6 5.76% $0.00