Answer:
The proper methodology for computing the depreciation expense for Year 2 assuming the firm opts to forego any bonus depreciation is $67,000*0.32
Explanation:
The depreciation expense shall be calculated by multiplying the cost basis of the asset with the depreciation rate for the respective years
The Cost of the Equipment = $60,000
The MACRS rate for Year 2 = 0.32
Depreciation for Year 2
= Cost basis of the asset*Depreciation rate for year 2
= $67,000*0.32
Therefore, The proper methodology for computing the depreciation expense for Year 2 assuming the firm opts to forego any bonus depreciation is $67,000*0.32
