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NINJA Question –
Hi! This is my first post, and I’ve got a question about 179 questions on the actual CPA REG exam.
So, the question in question, and several other similar questions, are a little strange to me. Here’s an example:
On February 1, 2014, Pam Baker purchased an $861,000 machine (5-year property) for use in her business. Pam expensed $25,000 under Section 179 in addition to the regular depreciation of 20% in 2014 and 32% in 2015. Pam’s total deductions for 2014 and 2015 for the machine are:
The correct answer is $192,200 (2014) and $267,520 (2015). Easy enough. The strange part is that the question doesn’t take into consideration the $200,00 purchase limitation and the $225,000 phaseout for 2014. In theory the correct answer wouldn’t include the 179 deduction. There are several other questions set up this way.
Now, I know that the Ninja MCQ are AICPA released questions. It seems weird that an AICPA released question wouldn’t include this fact. There are other questions where it mentions the limitation and you are suppose to include that fact into the equation.
So, are the actual CPA questions that are being put in the exam set-up better to where either they make sure to include the phaseout into the correct answer? Are the AICPA released questions simply re-set up 2013 questions where the limitation use to be $2,000,000?
I guess my best hope is that the actual exam questions will be better set-up, but if I run into a question just like this in the exam should I answer the question in the same way as the practice question?
FAR - 79 11/15/13
AUD - 75 5/16/14
BEC - 76 8/16/14
REG - Scheduled 11/26/14
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