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24 Cards in this Set

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Additions to a Major Fixed Asset

Create a different asset



Expensed

if the improvement maintains the asset at its current level



Capitalized

if the improvements make the asset a better product

Activity Based

based upon units, or use, or production

Straight-line method

consistent calculation used throughout the depreciation process (conservative)

Decreasing methods

provide for higher amount of depreciation at tht beginning and lower towards the end

Sum-of-Years-Digits

in between



Double-Declining Method

most aggressive

Passenger Vehicle

<6000


elect to take 8,000 bonus depreciation in the first year

Truck or Van

<14,000


elect to take 8,000 in the first year with a maximum of 3,160 for a total of 11,160

SUV

>6,000<14,000


elect section 179 up to 25,000


5-years MACRS

Tractor-Trailer

>14,000


elect section 179 up to 500,000


3-years MACRS

Mid-Month Convention

this is only for real property (residential or non residential estates)

Mid-Quarter Convention

This is used for MACRS qualified property where 40% has been purchased in the 4th quarter

Half-Year Convention

This is used for MACRS qualified property where the mid-quarter convention is not applicable

Tax Depreciation

is calculated from a calender year perspective

Marketing Related Intangibles

indefinite number of renewal periods of 10 years


Trademarks do not amortize

Artistic Related Intangibles

Copyright

Copyright

federally granted rights for artists, painters, musicians etc


can be amortized 70 years after the death of the artist

Technology Related Intangibles

Patent

Patent

Exclusive rights to use, manufacture and sell a product for a period of 20 years


can be amortized for 20 years

Goodwill

the amount of excess in a purchase of another company

Held to Maturity

securities that the company has the positive intent to hold til maturity


ex: Bonds

Trading Securities

Securities that are bought and held primarily for sale in the very near future to generate short-term price differences