[I'm, Ron Burgundy?]

I just attempted to do a simulation on MACRS and it completely kicked my butt. I understand which items use which convention (Half Year, mid-quarter, etc.). I also know the Depreciation recovery period associated with those items. No Problem. However, I’m getting hung up on the calculation.

Becker gives you the table in the book but doesn’t really explain how to come up with the multiplier they are using. Are we really supposed to memorize this table? I find that very hard to believe. There must be a faster and better way to come up with the amounts depreciated each year. In the simulation explanation it’s frustrating as the answer explanation continuously goes on to say that “per the table the multiplier is…”

Also, when it comes to the Half-year, mid-month, mid-quarter; Are we taking that amount at the end of the useful life or at the beginning? It appears to be, based on the table, that the multipliers are essentially cut in half in the year of disposal.

Thanks in advance for your help.

"If you're going through hell, keep going"
- Winston Churchill

"I've missed over 9,000 shots in my career. I've lost over 300 games. 26 times I've been trusted to take the game winning shot, and missed. I've failed, over and over and over again in my life. And that is why, I succeed."
- Michael Jordan

BEC: (54), (72), 80 (losing credit on 02/02/15 - nervous)
AUD: 78
REG: (74), 91
FAR: (71)

[barelystayingsane]

You don't need to memorize the table, and I don't believe you need to know how they calculate the numbers in the table. If they ask you a question on MACRS, they should give you the table or give you a bunch of numbers and you have to choose which ones are relevant to your calculation. The first numbers provided in the MACRS table have already been adjusted for the half-year, mid-quarter, etc. conventions. However, for the year of disposal, you will have to adjust the multiplier yourself if you dispose of the asset before it's been fully depreciated.

[barelystayingsane]

You don't need to memorize the table, and I don't believe you need to know how they calculate the numbers in the table. If they ask you a question on MACRS, they should give you the table or give you a bunch of numbers and you have to choose which ones are relevant to your calculation. The first numbers provided in the MACRS table have already been adjusted for the half-year, mid-quarter, etc. conventions. However, for the year of disposal, you will have to adjust the multiplier yourself if you dispose of the asset before it's been fully depreciated.

[Author]

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