Modified Accelerated Cost Recovery System

This case deals with the concept of depreciation which can be defined as an accounting method utilized to allocate the costs of the fixed assets over their useful lifetime, which is expected to last more than one year. There are multiple applicable depreciation methods based upon the type and use of the assets such as: straight-line method, double-declining balance, units of production or accelerated depreciation methods which were replaced with the Modified Accelerated Cost recovery system (MACRS) after the Tax Reform of 1986. In analyzing the presented scenario for the Salem Corporation, I will be utilizing the “Modified Accelerated Cost Recovery System” (MACRS) to calculate the deprecation amount that can be generated in 2010 for the property