Szabi Incorporated, a calendar year taxpayer, purchased two assets during 2021: a machine costing $680,000 and computer equipment costing $553,500. The machine is 7-year recovery property and the computer equipment is 5-year recovery property. Which of the following statements is true? Multiple Choice Under Section 179, Szabi should elect to expense the $680,000 cost of the machine and $370,000 of the cost of the computer equipment. Under Section 179, Szabi should elect to expense the $553,500 cost of the computer equipment machine and $496,500 of the cost of the machine. Under Section 179, Szabi must elect to expense $525,000 of the cost of the machine and $525,000 of the cost of the computer equipment. Under Section 179, Szabi is indifferent as to which costs to expense.

Example1 lcnrv: ted company uses the lower of cost or nrv method in valuing its inventory items. the inventory at december 31, 2017, consists of products a, b and c, each having 1,000 units. relevant unit data for these products appear below: item a item b item c cost $ 80 $80 $80 estimated selling price 180 100 90 estimated selling cost 30 30 30 required: using the lower of cost or net realizable value rule, determine the proper value of inventory for balance sheet reporting purposes at december 31, 2017. prepare any necessary journal entry. apply the lower of cost or nrv method: • on an individual inventory basis; • on a group basis; • on a total inventory basis. solution worksheet: inventory (on an individual basis): inventory value item nrv cost lc- item a item b item c total inventory (on a group basis): inventory value item nrv cost lc- group 1 (item a and b) group 2 (item c) total inventory (on an aggregate inventory basis): inventory value item nrv cost lc- total inv