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(Solved by Expert Tutors) Jack Jones, age 35, is single and has no dependents. At the beginning of


business and operated the business as a sole-proprietor.During all of 2010, Jack had the following items in connection with his business:Gross income from customers $612,000Building rental expenses $ 45,000Office expenses 2,500Utilities 4,000Secretarial salary 34,000Salaries, equipment operators 42,000Payroll taxes 7,000Equipment operating costs 21,000Additionally:Purchased a new front-end loader onJanuary 15, 09 for $260,000.Purchased a new dump truck onJanuary 18, 09 for $50,000During 2009, Jack had the following additional items:Interest income $10,000Dividend income from Exxon 9,500On October 8, 2009, Jack inherited IBM stock from his aunt Mildred. According to the data provided by the executor of her estate, the stock was valued for estate purposes at $110,000. Mildred had purchased the stock 9 months before death for $95,000. Jack sells the stock on December 1, 2009 at a selling price of $115,000.Consider the loader and truck placed in service on date purchased.On October 10, 2010, Jack purchased and placed in service a new Toyota auto (100% business use). The vehicle?s weight was 4,500 pounds and cost him $45,000. Jack did not elect bonus depreciation available to him as a result of the auto purchase.REQUIRED:Compute Jack?s 2010 adjusted gross income, assuming that he selected the front-endloader as the Sec 179 expensing election item, but limited the expensing under Sec 179 to $250,000. Also assume that he did not elect out ofthe bonus depreciation available to him on qualifying acquisitions, other than the auto.Assume: 7 year life on depreciable assets. That the expensing election under sec 179 has been increased to $500,000.That the 50% bonus depreciation has been extended though 12/31/10

 


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