Englehand purchases a slurry-based separator for the minning of clay that costs $700,000 and has an estimated useful life of 10 years, a MACRS-GDS property class of 7 years, and an estimated salvage value of $75,000 after 10 years. It was financed using a $200,000 down payment and a loan of $500,000 over a period of 5 years with an interest at 10%. Loan payments are made in equal annual amounts (principal plus interest) over the 5 years.

a. what is the amount of the MACRS-GDS depreciation taken in the third year?

b. what is the book value at the end of the third year?

c. returning to the original situation, what is the amount of the MACRS-GDS depreciation taken on the third year if the seperator is also sold during the third year?